ADRYX MINING AND METALS LTD AND OTHERS vs ASHANTI GOLDFIELDS CO LTD

The applicants, shareholders holding approximately 4.2% of Ashanti Goldfields Co Ltd's issued shares, sought the High Court's intervention under the Companies Code, 1963 (Act 179) to convene an extraordinary general meeting (EGM) to remove the existing board and elect a new one. They alleged that Ashanti, a publicly listed gold mining company, was in severe financial distress following a significant drop in share value from US$20 to US$3.125 due to problems with hedge book commitments and overall financial instability. The applicants contended that the current board, influenced by Lonmin PLC (holding 32% shares), was imprudent and not acting in the company's best interest, risking bankruptcy. They sought an injunction to restrain the board from entering agreements that would impair the ability of a new board to manage the company.

JUDGEMENT Richard Apaloo J. The applicants are in court to invoke the jurisdiction of the High court you under the Companies Code, 1963 (Act 179) for the following reliefs: “(1) An order for convening an extraordinary general meeting of the respondent company for the purpose of passing ordinary resolutions for the election of a new board of directors and the removal of the existing one. The extraordinary general meeting (hereinafter referred to as an EGM) if ordered, will consider a resolution under section 202(1)(a) to permit the sale of all, or any of the companys assests. (2) An injunction restraining the existing directors of the respondent company from entering into any agreement, contract or understanding which may impair or substantially reduce the ability of any board of directors elected at the general meeting to deal with the companys affairs as they might otherwise have chosen. (3) Consequential orders arising directly out of the reliefs sought.” The fi...