A near-unanimous vote has kept the Augusta Resource Corp.'s shareholder rights plan going, in the face of efforts by Hudbay Minerals Inc. to get rid of it.
In the business section of today's Star print edition, you can read about the British Columbia Securities Commission's action Friday afternoon that opens the door for this plan to be discontinued by mid-July under certain circumstances. Due to a variety of factors, both Augusta and Hudbay are hailing the commission's decision as a victory.
There was no such ambiguity in the resolution that passed among Augusta shareholders earlier on Friday. The shareholder rights plan won 94 percent of the votes cast at the annual meeting of Augusta stockholders in Vancouver, B.C., Augusta said in a news release. That doesn't count the 15.98 percent of the shares controlled by Hudbay, which is pushing a hostile takeover of Augusta.
Holders of shares representing 73.78 of Augusta's issued and outstanding common shares -- again not counting Hudbay's -- voted on the resolution.
Stockholders also overwhelmingly kept all seven Augusta board members at their posts -- including CEO and President Gil Clausen. All seven won at least 75.49 percent of the votes cast.
The shareholder rights plan allows existing stockholders to buy more stock at a substantial discount if another party acquires more than 15 percent of the company's total stock.
Hudbay's current 15.98 percent is not counted toward that, but if Hudbay were to acquire another 15+ percent, then the shareholder rights plan would kick in, effectively blocking a hostile takeover. If the shareholder rights plan were to be voided, it would be possible for Hudbay to acquire a total of 34 percent of all Augusta shares, and block anyone else from taking over the company.