VANCOUVER, April 25, 2019 /CNW/ - Turquoise Hill Resources
Ltd. ("Turquoise Hill") (TSX: TRQ) today responded to a recent open
letter to shareholders from SailingStone Capital Partners LLC
("SailingStone").
"The Board greatly values the views of our shareholders and the
input that we receive from them," said Peter Gillin, the independent Chair of Turquoise
Hill's Board of Directors. "The Board actively considers the
interests of shareholders in all of its actions and when
shareholders provide feedback, the Board listens."
"The independent directors have engaged extensively with
SailingStone and other major shareholders and have always been
responsive to feedback, including from SailingStone," continued Mr.
Gillin. "In the past two years, the Board has enhanced its
corporate governance practices as a result of such feedback."
Examples of the enhancements to Turquoise Hill's corporate
governance implemented by the independent directors include:
- Hiring a new CEO in 2018 who is a direct employee of Turquoise
Hill and reports exclusively to the Board.
- Committing to directly employ certain other senior officers in
the future, rather than have them seconded by Rio Tinto, the
majority shareholder of Turquoise Hill.
- Increasing direct participation by Turquoise Hill management in
Oyu Tolgoi matters, including in various Oyu Tolgoi working groups
that are interacting with the Government of Mongolia and in Oyu Tolgoi cost and schedule
reviews.
- Establishing a joint project management office with Rio Tinto
and Oyu Tolgoi as an additional mechanism to facilitate sharing of
information.
- Implementing a long-term incentive plan exclusively in
Turquoise Hill share-based compensation to align our executives'
compensation with the interests of all shareholders.
- Adopting formal shareholding guidelines requiring named
executive officers and the independent directors to accumulate a
meaningful equity interest in Turquoise Hill over a five-year
period and three-year period, respectively.
- Implementing a formal shareholder engagement policy which
encourages and facilitates dialogue with all Turquoise Hill
shareholders.
Like SailingStone, the Board wants to see Oyu Tolgoi's
underground mine built safely and quickly. And like SailingStone,
the Board is frustrated with the performance of Turquoise Hill's
shares.
The Board has four excellent independent directors who form a
majority of the Turquoise Hill Board and who have the necessary
experience, skills and industry knowledge to serve the best
interests of Turquoise Hill, including serving the best interests
of all shareholders:
- Peter Gillin joined the
Board in May 2012. He previously
served as Chief Executive Officer of several public mining
companies in Canada and before
that was a prominent investment banker. As Chair, he has actively
supported the Board's enhanced corporate governance initiatives,
including those listed above.
- Russ Robertson joined the
Board in June 2012 and has a
distinguished career in the financial sector, having served as the
CFO of BMO Financial Group. He has over 35 years of experience as a
Chartered Professional Accountant. Mr. Robertson's financial
expertise and knowledge of compensation and human resources matters
are an asset to the Board, particularly as it continues to build
independent incentive compensation plans for Turquoise Hill
executives.
- James Gill joined the
Board in November 2014. Mr. Gill is a
member of the Canadian Mining Hall of Fame, having founded Aur
Resources in 1981 and grown the company into a world-class
international mining operation that was ultimately sold for over
$4 billion. Mr. Gill's experience as
a geologist, founder and CEO, and his experience in complex mining
operations, including the development and/or operation of nine
mines during his career with Aur, are invaluable to the Board.
- Maryse Saint-Laurent
joined the Board in January 2017. Ms.
Saint-Laurent has a strong
background in corporate governance, public market and project
finance, corporate and securities law, as well as executive
compensation, experience she acquired as a senior executive in the
capital-intensive energy industry. Ms. Saint-Laurent has played a prominent role in
restructuring Turquoise Hill's compensation practices and in
negotiating changes to the secondment arrangements between
Turquoise Hill and Rio Tinto.
This strong team of independent directors is highly focused on
realizing long term value for all of our shareholders and has been
effective in advocating for enhancements to governance and
management independence.
Consistent with best practices, the Nominating and Corporate
Governance Committee of the Board evaluates annually the Board's
succession plans in line with the strategic needs of Turquoise
Hill. The Board has adopted term limits for directors in order to
ensure board renewal. The Nominating and Corporate Governance
Committee uses a skills matrix, which it reviews annually and
considers as part of its Board renewal and succession planning
process to identify potential nominees who possess the skills and
expertise required to make meaningful contributions to the Board
and to guide Turquoise Hill forward in its strategy. As part of
this process, the Board welcomes, and the Committee would give due
consideration to, any qualified candidates that shareholders bring
to the Board's attention.
The Company urges shareholders to support the Board, including
all of the independent directors, at the forthcoming annual
meeting.
Information About the Meeting
The Annual Meeting of Shareholders will be held at 9:00 a.m., Eastern Time, on May 14, 2019, in Saint-Laurent 5 of Hôtel Bonaventure Montréal,
located at 900 Rue de la Gauchetière Ouest, Montréal, Québec,
Canada.
If you are a registered shareholder, to ensure your vote is
counted, we encourage you to complete, date and execute the form of
proxy that you received in your meeting materials and deliver it by
no later than 5:00 pm (Eastern Time)
on May 10, 2019 by facsimile, by
email, by hand or by mail in accordance with the instructions set
out in the form of proxy and in the management proxy circular.
Shareholders holding shares through a broker or other
intermediary are encouraged to follow the instructions sent to them
by their broker or other intermediary to ensure that their votes
are counted. Should any shareholder have any questions about voting
their shares, please contact the Company's strategic shareholder
advisor and proxy solicitation agent, Kingsdale Advisors, at
1-866-229-8214 or by email at contactus@kingsdaleadvisors.com. The
Company has engaged Kingsdale Advisors to assist Turquoise Hill in
the solicitation of proxies in respect of the Annual Meeting. In
connection therewith, Kingsdale Advisors will receive a base fee of
$55,000 for proxy solicitation
services as well as additional fees for telephone calls and the
reimbursement of certain out-of-pocket expenses, which will be
borne by the Company.
About Turquoise Hill
Turquoise Hill (TRQ: TSX, NYSE, NASDAQ) is an international
mining company focused on the operation and further development of
the Oyu Tolgoi copper-gold mine in southern Mongolia, which is the Company's principal and
only material mineral resource property. Turquoise Hill's ownership
of the Oyu Tolgoi mine is held through a 66% interest in Oyu Tolgoi
LLC; the remaining 34% interest is held by Erdenes Oyu Tolgoi LLC,
a Mongolian state-owned entity. Turquoise Hill is 50.8% owned by
Rio Tinto plc, one of the world's largest metals and mining
corporations.
Forward-looking statements
Certain statements made
herein, including statements relating to matters that are not
historical facts and statements of the Company's beliefs,
intentions and expectations about developments, results and events
which will or may occur in the future, constitute "forward-looking
information" within the meaning of applicable Canadian securities
legislation and "forward-looking statements" within the meaning of
the "safe harbor" provisions of the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements and information relate to future events or future
performance, reflect current expectations or beliefs regarding
future events and are typically identified by words such as
"anticipate", "could", "should", "expect", "seek", "may", "intend",
"likely", "plan", "estimate", "will", "believe" and similar
expressions suggesting future outcomes or statements regarding an
outlook. These include, but are not limited to, statements about
anticipated business activities, planned expenditures, corporate
strategies, and other statements that are not historical facts.
Forward-looking statements and information are made based upon
certain assumptions and other important factors that, if untrue,
could cause the actual results, performance or achievements of the
Company to be materially different from future results, performance
or achievements expressed or implied by such statements or
information. There can be no assurance that such statements or
information will prove to be accurate. Such statements and
information are based on numerous assumptions regarding present and
future business strategies, local and global economic conditions,
and the environment in which the Company will operate in the
future, including the price of copper, gold and silver, anticipated
capital and operating costs, anticipated future production and cash
flows, and the status of the Company's relationship and interaction
with the Government of Mongolia on
the continued development of Oyu Tolgoi and Oyu Tolgoi LLC internal
governance. Certain important factors that could cause actual
results, performance or achievements to differ materially from
those in the forward-looking statements and information include,
among others, copper; gold and silver price volatility;
discrepancies between actual and estimated production, mineral
reserves and resources and metallurgical recoveries; development
plans for processing resources; matters relating to proposed
exploration or expansion; mining operational and development risks;
litigation risks; regulatory restrictions (including environmental
regulatory restrictions and liability); Oyu Tolgoi LLC's ability to
deliver a domestic power source for the Oyu Tolgoi project within
the required contractual time frame; communications with local
stakeholders and community relations; activities, actions or
assessments, including tax assessments, by governmental
authorities; events or circumstances (including strikes, blockages
or similar events outside of the Company's control) that may affect
the Company's ability to deliver its products in a timely manner;
currency fluctuations; the speculative nature of mineral
exploration; the global economic climate; dilution; share price
volatility; competition; loss of key employees; cyber security
incidents; additional funding requirements, including in respect of
the development or construction of a long-term domestic power
supply for the Oyu Tolgoi project; capital and operating costs,
including with respect to the development of additional deposits
and processing facilities; and defective title to mineral claims or
property. Although the Company has attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in forward-looking
statements and information, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. All such forward-looking statements and information are
based on certain assumptions and analyses made by the Company's
management in light of their experience and perception of
historical trends, current conditions and expected future
developments, as well as other factors management believes are
appropriate in the circumstances. These statements, however, are
subject to a variety of risks and uncertainties and other factors
that could cause actual events or results to differ materially from
those projected in the forward-looking statements or
information.
Readers are cautioned not to place undue reliance on
forward-looking information or statements. By their nature,
forward-looking statements involve numerous assumptions, inherent
risks and uncertainties, both general and specific, which
contribute to the possibility that the predicted outcomes will not
occur. Events or circumstances could cause the Company's actual
results to differ materially from those estimated or projected and
expressed in, or implied by, these forward-looking statements.
Important factors that could cause actual results to differ from
these forward-looking statements are included in the "Risk Factors"
section in the Company's Annual Information Form dated as of
March 13, 2019 in respect of the year
ended December 31, 2018 (the
"AIF").
Readers are further cautioned that the list of factors
enumerated in the "Risk Factors" section of the AIF that may affect
future results is not exhaustive. When relying on the Company's
forward-looking statements and information to make decision.
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SOURCE TURQUOISE HILL RESOURCES LTD