8.40pm: the result
The counting concluded in the evening, with shareholders holding over 80% of the company approving the Anglo American takeover offer, for a total of 2.4bn shares in Sirius.
Despite the uprising, only 502 investors voted against the deal, while 812 approved it.
Chairman Russell Scrimshaw said: “The positive outcome from today’s meeting secures a return for shareholders, and provides greater certainty in terms of safeguarding the project, protecting the jobs of our employees, and allowing the community, region and the UK to continue to benefit from the project.”
3.10pm: a recap
While the market waits for the results coming up later today, here are the key points of today’s meeting:
- The board has been firm that the takeover is the only viable solution for Sirius to carry on
- They also said Anglo could still buy Sirius from administrators when it inevitably goes bankrupt
- The mine is expected to need another US$3.1bn to reach completion
- Chief executive Chris Fraser has said that while the project was “the greatest success” of his career, the financing issues were “the greatest failure”
- Some investors admitted they were not ready to give up on the Sirius dream
- Boris Johnson’s government chose not to help the project, said to be “the poster child” of supporting the North of England, according to Fraser
- Some investors later pointed out a failed takeover by Anglo could prompt Westminster to act
2.45pm: results of the vote
Investors will have to sit and wait now, as Sirius Minerals should publish the results of the vote later on Tuesday.
We will report the results here when they arrive.
1.40pm: vote is underway
The vote now is underway. The deal needs approval from shareholders owning 75% of Sirius to go ahead.
Today there are some retail shareholders but the bulk comes from proxy votes.
The Sirius meeting is going to a vote on the Anglo takeover. About 60 or so retail shareholders here, we think. But it’s the thousands of individual investors who have voted in advance who are expected to have swayed the decision either way...
— Emily Gosden (@emilygosden) March 3, 2020
Half of the company is owned by 85,000 private investors.
Among institutional investors, hedge fund Odey Asset Management owns 1.73% of Sirius and has been openly criticising the offer.
Jupiter Fund Management, holder of 7.8% shares, is reportedly backing the deal.
1.20pm: Fraser says financing "biggest failure of my career"
Investors appreciate Fraser expressing his feelings.
He says the delivery of this project from an idea to what it has become today is "probably the greatest success of my career", while the missed financing "the biggest failure".
OK so this is a very important exchange going on here - this is the catharsis people have wanted, CF saying he regrets this is massive. CF says all shareholders should look at why they wanted to support the project, he says it’s a shame shareholders can’t participate
— Francesca Washtell (@fwashtell) March 3, 2020
Amid conspiracy theories that Anglo and Sirius worked together to get to this stage, a shareholder admits how feelings got in the way.
“I’m finding it hard to let go,” he continues. “I am emotionally attached to this stock. I don’t want the dream to end.”
This is like a breakup. I wasn’t prepared for this kind of emotional labour.
— Ed Clowes (@EdClowes) March 3, 2020
1.10pm: Anglo will have to spend US$3.1bn
The board says Anglo will have to invest US$3.1bn on top of the US$1.5bn spent by Sirius to get the project going, for 31km of tunnels, two mile-deep shafts and port facilities.
Scrimshaw: We've talked to every other mining company and not had an offer.
He points out that while they believe hugely in polyhalite and there is a market, it's not a product that many major mining companies are investing in.
— Rob Davies (@ByRobDavies) March 3, 2020
Some people are happy with the deal, while others say a rejection can be a signal to the government.
One shareholder believes a no vote at today's EGM would force the govt to think again on backing Sirius Minerals and something else may come up.
This is a huge risk, says Scrimshaw.
— Rob Davies (@ByRobDavies) March 3, 2020
12.50pm: activist group expresses support
A representative of activist group 'Fund Sirius Minerals" says investors are willing to back the company through a round of funding.
Says there is appetite - even if we could raise £200m to get us through the next year. Round of applause. Scrimshaw thanks her for her passion, but says in the past when gone back to the market for cash it has not had very much take up from retail shareholders
— Francesca Washtell (@fwashtell) March 3, 2020
The activists have set out a plan to raise £460mln through bonds to fund the company for another two years.
With the extra £460mln, Sirius could lay out “critical infrastructure development” all the way through 2022.
The sum came up in a strategic review carried out in September.
So far, the initiative has surveyed 1,845 people, who have shown interest in providing over £43mln combined.
12.30pm: shareholders ask for a stock offer
Shareholders ask why Anglo American did not propose a stock offer instead of cash.
Fraser says local MP Robert Goodwill did lobby for that option.
Someone asks if the company can freeze for a year.
Q8: Can the company close for a year? (Also a good moment to say I’m paraphrasing some of these points.) Scrimshaw: nope, we’d need to go into administration.
— Francesca Washtell (@fwashtell) March 3, 2020
A shareholder is happy to learn Anglo American is actually British.
Richard Lodge: "I did think Anglo American was an American company but it isn't so I don't have that against it."
— Rob Davies (@ByRobDavies) March 3, 2020
12.15pm: Fraser criticises the government
In relation to government backing, the board says that Westminster simply chose not to help and Fraser proceeds to criticise Boris Johnson.
Chris Fraser: "As much as the PM makes these statements about wanting to support the north, this is the poster child for what they should be supporting and they chose not to."
Most direct criticism of the govt yet from Sirius Minerals boss Chris Fraser.
— Rob Davies (@ByRobDavies) March 3, 2020
The board keeps backing the deal, especially as markets are being depressed by the coronavirus outbreak.
This is where investors really seem to feel like they’re being disrespected. Fraser said board’s preferred outcome would be for Anglo to be a strategic partner. Says he totally accepts this is not a good deal - but with Coronavirus it would be even harder to raise cash now
— Francesca Washtell (@fwashtell) March 3, 2020
12pm: board says Anglo can still seize Sirius from administrators
Fraser says that even if the vote fails, Anglo will still be able to buy Sirius from administrators once it collapses, which is what they expect if the vote is not approved.
“There’s no point hypothesizing about vain hopes of what might happen. This is the offer on the table today. If shareholders vote against this, the most likely outcome is that Sirius collapses,” says Fraser.
— Ed Clowes (@EdClowes) March 3, 2020
Shareholders have been pressing the board to ask Anglo American for a higher offer or else, government loans, but for the board these options are not on the table.
Back to the meeting.
Fraser says that no higher offer is coming from Anglo American.
“We’ve failed, and we’re incredibly sorry for the outcome. But this offer is the only way forward.”
— Ed Clowes (@EdClowes) March 3, 2020
11.45am: activist shareholder lambasts Fraser
Chairman Russel Scrimshaw said security has been ramped up following threats to the board and apologised to investors for how the situation worsened, according to reports.
Chief executive Chris Fraser speaks about the failed deal with the government.
Chris saying it would have been transformational to get the support from the Government - this is the first reference so far to the company’s financing not being underwritten by the Govt at the last minute. This is the event that set Sirius on the path to the collapsed financing
— Francesca Washtell (@fwashtell) March 3, 2020
Gavin Palmer, an activist shareholder, says Fraser is "stupid".
Palmer is done, finishing off by calling the board "idiotic".
A ripple of applause in the room.
Fraser is asked if he'd like to respond.
"There's no point."
— Rob Davies (@ByRobDavies) March 3, 2020
11am: so it begins
The most anticipated shareholder meeting of the past decade has kicked off in London this morning.
Sirius Minerals PLC (LON:SXX) shareholders are voting whether to accept a takeover offer from global mining giant Anglo American Plc (LON:AAL) or let the troubled fertiliser company carry on its own towards an uncertain future.
Sirius is the developer of what it is believed to be the world's largest and highest grade deposit of polyhalite in North Yorkshire, England, but was hit by funding problems.
The share price plummeted from 20p a year ago to 4.5p today.
Never seen this much security for a shareholder meeting.
Fair to say that emotions are running high ahead of a vote this morning to decide the fate of Sirius Minerals. pic.twitter.com/1Qsmclx7Cr
— Ed Clowes (@EdClowes) March 3, 2020
Mining giant Anglo American Plc (LON:AAL) came to the rescue with a £405mln offer to take over the fertilising company, valuing it 5.5p per share.
However, a plethora of investors who paid double or triple that amount said it “significantly” undervalues the firm.
Plus, half of the shares are owned by 85,000 individuals some of whom claim to have poured their lifetime savings into the project, fearing a big hit on their personal finances.
While the board is backing the deal in fear of bankruptcy, a group of activist investors have been criticising the directors for not asking for more support.
Tight security though. Chairman says there have been credible threats against the company’s people. Says very disappointed about abusive language directed at management and BoD.
— Thomas Biesheuvel (@tbiesheuvel) March 3, 2020
According to a strategic review carried out in September, Sirius needed £460mln to start the project.
However, the money was nowhere to be found and the board recommended shareholders to approve the takeover by Anglo American instead.
“At no point during or following the strategic review did Sirius reach out to private investors to request their support with the funding, despite them owning 50% of the shares in Sirius,” action group ‘Fund Sirius Minerals’ said.
“We believe that this was an error on the part of Sirius and a missed opportunity to raise the funds and protect shareholders’ existing investments.”