According to the Calgary Herald, Winsway representative Jerry Xie told a BMO Capital Markets mining research analyst there was no impact on the transaction projected to close in February 2012.
“Yes, we were aware of it,” Xie, via an email to BMO’s Meredith Bandy, was quoted by the newspaper. The outlet said the comment was later confirmed.
“This allegation is three years old. It is directed at individuals, not the company and does not affect the underlying value of the mining assets.”
Last week, GCC president and chief executive Robert Henry Stan, his wife Kathryn Paula Stan and other company executives including Anita Louise Roncin, former general manager Timothy Peter Riordon, plus current vice president of marketing and transportation Eugene Hiroshi Nagai and controller Kevin Ronald Wade, were accused of illegal insider trading by the Alberta Securities Commission.
According to the agency’s claims, the activity occurred between May and July 2008, the paper said.
“[We have] been made aware that a notice of hearing has been issued…alleging contraventions of section 147 of the Securities Act (Alberta) and conduct contrary to the public interest,” officials said nearly immediately after the ASC’s announcement.
“The allegations are unproven and the corporation has been informed that each of the named persons denies the allegations and intends to dispute and defend himself against the allegations in the notice.”
Company chairman Robert Brawn also told the paper that the company, which itself was not named, would “vigorously” defend its executive members, adding his knowledge that the buyout partners were aware of the commencement of an investigation.
According to the Calgary Herald, if the individuals are found guilty of the breaches of Alberta’s securities law, the ASC can assess penalties of up to $1 million for each charge in addition to repayment of costs. They can also be banned from being a company director for life.
Alberta-based GCC and Winsway first announced the deal October 31, confirming that the cash deal would work out to $10 per common share, a 70% premium over the closing price on October 28 and a 112% premium over the 20-day volume weighted average trading price on the Toronto Stock Exchange.
The deal is subject to regular closing conditions, including regulatory approvals, and a 66 2-3% approval vote by GCC shareholders.
It also requires majority approval of Winsway's shareholders and the approval of the Hong Kong Stock Exchange.
Grande Cache Coal holds coal leases covering over 22,000 hectares with an estimated 346 million tonnes of coal resources in the Smoky River coalfield.
