Sirius Minerals takeover must happen for the sake of North Yorkshire - Ros Snowdon

The decision comes amid reports that a majority of Sirius’ retail investors intend to vote against Anglo’s rescue deal.

Hargreaves Lansdown, which represents small investors who hold 17 per cent of the stock, said it has seen more shareholders vote against the deal than for it.

The deal will need approval by a majority of investors voting by number and by 75 per cent of those voting by value.

Most institutions, with some notable exceptions, will vote for the Anglo deal, seeing it as preferable to getting nothing at all if the company goes into administration. Earlier today Jupiter Fund Management said it will use its 7.8 per cent stake in Sirius to back the takeover by the FTSE 100 mining giant.

Any move to block the deal will jeopardise thousands of North Yorkshire jobs and leave small investors with absolutely nothing.

It is understandable that investors are angry. Many received poor advice from their brokers regarding the risks involved with investing in such a speculative venture.

They may get some satisfaction from seeing the whole project collapse, but this would be a futile and destructive decision.

The plan for the mine involves tunnelling under North York Moors National Park to exploit what Sirius has said is the world’s largest deposit of polyhalite, a multi-nutrient fertiliser. It will create a huge opportunity to reboot the North Yorkshire economy.

The ShareSoc Sirius Shareholders Group (SSSG), which is supporting small investors in Sirius Minerals, said shareholders now face a stark choice between accepting Anglo American’s “unpalatable” 5.5p per share offer or “the very high probability” of losing everything if they reject it.

Local shareholders have seen the Sirius share price sink from 45p in 2016 to close to 5.5p. Almost half of the company’s shares are held by 85,000 small investors, including 25,000 shareholders in Yorkshire and the North East. Around 10,000 investors live in the immediate region of the North Yorkshire mine.

SSSG said a rejection of the offer is likely to lead to a rapid transition into administration.

The shareholder group said some investors have said they will allow their emotions to dictate their vote, preferring to risk everything rather than to accept what they see as an unfair outcome.

ShareSoc’s view is that investment decisions should be made on objective, not emotional grounds. That said, SSSG admitted that the offer of 5.5p by Anglo is “undoubtedly opportunistic and takes advantage of the distressed financial position of Sirius”.

If this deal doesn’t go through tomorrow, Sirius will have little choice but to place the company into administration.

If that happens, not only do the shareholders miss out, but so does the local community, which will benefit from the thousands of jobs that will be created by the project.

The Northern Powerhouse Partnership has said Anglo’s offer is welcome news for the area and will bring some certainty to the 1,200 staff working on the project at the Wood Smith Mine near Whitby and in Scarborough.

This has been a sorry episode for Sirius’ shareholders, but perhaps it is time to think of the greater good that the mine will bring.

“It’s Hobson’s choice,” said one analyst.

“They either get a small amount of money or they get none.”

Yes, shareholders may lose a lot of money, but 5.5p is better than nothing.