Eastern Platinum (EPS) announced this week that it had received “unproven whistleblower allegations” of “undisclosed related party transactions pertaining to the sale of chrome concentrate at discounted prices”.
If proven true, this would be tantamount to asset stripping.
A special committee comprising two independent directors has been formed to investigate the allegations and, based on the findings, recommend what steps to take.
“The Board has determined that it is in the best interests of the company to form a special committee … consisting of two independent directors, George Graham Dorin and Xin (Alex) Guan,” EPS said in a Sens announcement on Tuesday.
“The committee will be responsible, together with independent counsel retained by the committee, for conducting an investigation, review and analysis of the allegations and if deemed appropriate will provide recommendations to the board on any necessary steps to be taken …”
A letter Ulrich Roux and Associates sent to Eastplats and its CEO Wanjin Yang on behalf of a number of minority shareholders last week alleges that Eastplats subsidiary Barplats sold roughly 100 000 tons of chrome concentrate at $105.11 a dry metric ton, roughly half the going market price of $213/t.
That’s nearly $11 million (R200 million) in revenue that is alleged to have been stripped from the company.
“It is evident that these unauthorised transactions were not concluded at arm’s length and concluded with the sole intention of prejudicing the...
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