Investment management group Worldview Capital Management has issued legal proceedings in the High Court against Irish exploration company Petroceltic, in which it holds more than 27 per cent of the share capital. The shareholder has also called for the resignation of Petroceltic CEO Brian O'Cathain.
The proceedings are in relation to Petroceltic’s alleged breach of a corporate governance agreement entered into between Worldview and Petroceltic which was announced by Petroceltic on June 16th 2014.
In response, Petroceltic said that it has not received notification of any pending litigation.
“ The company continues to listen and respond to concerns of its investors, and remains focused on delivering value for all shareholders. Petroceltic will be providing an update on strategy at a planned investor day next month,” the company said in a statement.
According to Worldview, the board of Petroceltic had agreed to undertake and complete a strategic, business and operational review of the company prior to September 30th 2014, in return for support from Worldview for Petroceltic’s $100 million placing that required a special shareholder resolution to be passed by 75 per cent of the shareholders. The placing was subsequently successfully completed in reliance on this support from Worldview.
In a statement to the London Stock Exchange on Monday morning, Worldview Capital Management partner and chief executive officer, Angelo Moskov, said:
“Worldview is very disappointed that Brian O’Cathain and the management have chosen not to honour the company’s agreement with its largest shareholder. We see it as a gross breach of corporate governance. We call for the immediate resignation of CEO Brian O’Cathain. We are withdrawing our support for the CEO and the management team effective immediately and we reserve our right to pursue legal action against other executives and coard members.”
Petroceltic had been the subject of a takeover bid by Dragon Oil, but the oil producer, which is backed by Dubai's state oil company, abandoned the deal earlier this month due to weak market conditions.
