Timmins Gold Establishes Special Committee; Comments on False Assertions
NEWS RELEASE TRANSMITTED BY Marketwired
FOR: Timmins Gold Corp.
TSX SYMBOL: TMM
NYSE MKT SYMBOL: TGD
JUNE 6, 2014
Timmins Gold Establishes Special Committee; Comments on False Assertions
Sets July 31, 2014 as date for Annual General Meeting
VANCOUVER, BRITISH COLUMBIA--(Marketwired - June 6, 2014) - Timmins Gold Corp.
(TSX:TMM)(NYSE MKT:TGD) ("Timmins Gold" or the "Company")
announced today that it has established a special committee of independent
directors to oversee the Company's response to Sentry Investments'
dissident proxy solicitation and the Company's process of Board renewal.
The members of the special committee are Frank Cordova, Paula Rogers (Chair)
and Jose Vizquerra.
Specifically, the special committee, with the assistance of Korn Ferry
International, is working to identify additional independent director
candidates for Timmins' Board, with skills and experience that complement
and augment the Board's capabilities. The special committee has also
retained Norton Rose Fulbright Canada LLP as independent legal counsel.
"We responded immediately to Sentry's concerns, seeking to address
them privately through constructive action aimed at enhancing the quality and
independence of our Board," said Paula Rogers, Chair of the special
committee. "This included inviting Sentry to propose director candidates
for the Board's consideration as a means to enhancing Timmins' Board
and avoiding a costly, distracting and, in our view, counterproductive, proxy
contest. We are disappointed that Sentry rejected our good faith efforts and is
proceeding with an action that would have the effect of transferring corporate
In discussions with Timmins Gold last week, Sentry refused any compromise and,
instead, threatened to launch a public proxy contest unless Timmins Gold
accepted Sentry's demand for control of the Board.
The Board is engaged in a continual process of renewal, adding four new
directors in the past three and half years, including the December 2013
appointment of Mr. Vizquerra, President and CEO of Oban Mining Corp. Mr.
Vizquerra has a strong Latin American mining merger and acquisitions background
as a former head of project evaluations for Lima, Peru-based Compania de Minas
Buenaventura, the largest owner of mining rights in Peru. He also served as a
mine geologist with Vancouver-based Goldcorp Inc.
Discussions with several large and small shareholders indicate that
shareholders recognize the success of the current Board and management in
developing the San Francisco gold mine into a sustainable and profitable
producer. Such shareholders have indicated to Timmins Gold that they believe
wholesale change to the Board and management is not in the best interests of
Under Timmins Gold's current Board and management, the Company has, among
-- Brought the San Francisco gold mine into production on time and on
-- Consistently grown production year-over-year, and by more than 150%
since starting production in 2010
-- Grown reserves by 170%, measured and indicated resources by 170%, and
inferred resources by 22 times (all net of depletion) since 2008
-- Established and grown a 100% local Mexican operating team, and earned
local recognition for its commitment to social responsibility
-- Posted significant positive free cash flow for the past three quarters,
in a challenging gold price environment
-- Carried out an extensive regional prospecting campaign over the past few
years which has identified two targets that show potential to host a
deposit similar to San Francisco
Ms. Rogers stated, "Timmins Gold has delivered an approximate 390%
shareholder return since becoming a public company. We have executed on our
strategy to deliver positive cash flow and we have done so in a difficult
market environment. We continually strive to improve and optimize our business,
including corporate governance, but we do not believe wholesale change is
warranted or that it would benefit shareholders. To the contrary, we believe
such change would be highly disruptive to our business and would run contrary
to shareholders' best interests."
Timmins Gold also responded today to false assertions that management declined
to present a takeover offer to the Board, and that Timmins Gold signed
confidentiality agreements with potential suitors and then refused to provide
such suitors with relevant information. These false assertions seem intended to
mislead shareholders and undermine confidence in the Board.
With respect to the false assertion that management failed to bring a takeover
proposal to the attention of the Board, the fact is that a potential suitor at
one time put forward an indicative non-binding proposal to acquire Timmins
Gold. Management immediately brought the proposal to the Board's attention
and the potential suitor was granted exclusivity and afforded the opportunity
to undertake due diligence, but declined to make a binding offer to acquire
With respect to the false assertion that Timmins Gold is denying potential
suitors relevant information, the fact is that the Company has provided
numerous parties with relevant information under confidentiality agreements.
Moreover, the Company has consistently allowed potential acquirers to tour the
San Francisco mine.
"The Board is always willing to consider transactions that would benefit
the Company and all of its shareholders, but to date the Company has not
received a binding takeover bid from any party," said Ms. Rogers.
"The Company remains active in exploring and pursuing opportunities to
enhance shareholder value and has entered into a number of confidentiality
agreements pursuant to which interested parties have been granted due diligence
access to the Company. Should the Company receive an offer, the Board will of
course consider it in accordance with its fiduciary duties."
Annual Meeting Date
Timmins Gold also today announced that it has scheduled the Annual General
Meeting of shareholders on July 31, 2014, with a record date of June 17, 2014.
In due course the Company will confirm a specific time and location and will
issue a Management Information Circular with all of the appropriate required
disclosure, including detailed information about its nominees.
Timmins Gold has retained Laurel Hill Advisory Group to provide strategic proxy
Neither the TSX nor its Regulation Services Provider (as that term is defined
in the policies of the TSX) nor the New York Stock Exchange MKT accepts
responsibility for the adequacy or accuracy of this news release.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained herein may constitute forward-looking statements
and are made pursuant to the "safe harbor" provisions of the United
States Private Securities Litigation Reform Act of 1995 and Canadian securities
laws. Forward-looking statements are statements which relate to future events.
Such statements include estimates, forecasts and statements as to
management's expectations with respect to, among other things, business
and financial prospects, financial multiples and accretion estimates, future
trends, plans, strategies, objectives and expectations, including with respect
to production, exploration drilling, reserves and resources, exploitation
activities and events, future operations, organic growth, mergers and
acquisitions and the appointment of new directors.
In some cases, you can identify forward-looking statements by terminology such
as "may", "should", "expects", "plans,
"anticipates", believes", "estimates",
"predicts", "potential", or "continue" or the
negative of these terms or other comparable terminology. These statements are
only predictions and involve known and unknown risks, uncertainties and other
factors that may cause our or our industry's actual results, level of
activity, performance or achievements to be materially different from any
future results, levels of activity, performance, or achievements expressed or
implied by these forward-looking statements.
While these forward-looking statements, and any assumptions upon which they are
based, are made in good faith and reflect our current judgment regarding the
direction of our business, actual results will almost always vary, sometimes
materially, from any estimates, predictions, projections, assumptions or other
future performance suggestions herein. Except as required by applicable law,
Timmins Gold does not intend to update any forward-looking statements to
conform these statements to actual results.
FOR FURTHER INFORMATION PLEASE CONTACT:
Timmins Gold Corp.
Vice President, Corporate Development
Longview Communications Inc.
INDUSTRY: Manufacturing and Production - Mining and Metals
-0- Jun/06/2014 10:00 GMT
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