Sirius shareholders get much needed investor forum - Ros Snowdon

Small shareholders in Sirius Minerals now have a forum they can join if they want to make their voices heard over Anglo American’s £405m offer for the group.
Local shareholders have seen the Sirius share price sink from 45p in 2016 to close to 5.5pLocal shareholders have seen the Sirius share price sink from 45p in 2016 to close to 5.5p
Local shareholders have seen the Sirius share price sink from 45p in 2016 to close to 5.5p

ShareSoc, a campaigning organisation that represents and supports small investors, has agreed to help Sirius shareholders. It is calling on shareholders to collectively work together to get the best outcome for all investors.

ShareSoc said it has launched the ShareSoc Sirius Shareholder Group to provide whatever support it can. The group is not giving an opinion at this stage on the merits of the proposed Anglo bid. It aims to facilitate shareholder communication both between themselves and with relevant parties.

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It will also help shareholders “to review and evaluate their current situation and (limited) options” and will make representations to involved parties, relevant bodies and to the press where appropriate.

The Sirius Shareholder Group (SSG) said it can act as a focal point for individual shareholders. Yorkshire investors can sign up via:

SSG said it should be made absolutely clear that it is in “fact finding mode” at this stage and that its involvement is about helping shareholders to evaluate and communicate. It said this initiative should sit alongside shareholders’ own representations to MPs.

This is a welcome move and one that is long overdue.

Local shareholders have seen the Sirius share price sink from 45p in 2016 to close to 5.5p and until now they have not had a body to represent them.

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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 mine.

Before the firm offer was made on January 20, Paul de Gruchy, a ShareSoc director, wrote a post which can be read on the ShareSoc Sirius Forum.

In it, he said it is important that ShareSoc manages expectations realistically.

“Some investors will have lost money that they could not afford to lose and/or which they will not be able to replace. This is very sad to hear,” he said.

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“However, just because a large number of people have suffered a painful loss does not mean that they will be compensated. That is not how the stock market works. There are very few cases of investors receiving compensation for losses they have suffered on the stock market, and it is important not to raise expectations.”

There are a number of terrible stories of people who invested their entire pension pot in the stock and are now facing a grim future.

Mr de Gruchy makes a very valid point about suggestions that a further rights issue could bring the project to completion.

“That may be true, but it would require existing investors to invest much more, and be tied into the project for several years with no certainty of the outcome,” he said.

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“In other words, the Anglo offer gives certainty of 5.5p a share now. Unless another offer comes in, the alternative is to invest more money, hope that others do the same, take on all the risks, and hope that the share price rises in future.

“I cannot say clearly enough: do not assume that the offer on the table is the worst case scenario – in investing, the worst case scenario is losing everything.”

Sirius shareholders desperately need a body to represent them. SSG is sensible to manage expectations and not promise the world.

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