Forrest leaves Poseidon, still owed $8m
Mr Forrest was in New York on Friday, and his staff confirmed that he would resign from Poseidon after serving more than six years as its chairman and major shareholder.
"Mr Forrest has resigned as director of Poseidon Nickel. His significant focus and priority is on his philanthropic efforts, as well as his continued engagement and position as chairman of Fortescue Metals Group," a spokesperson said.
Mr Forrest made no reference to the $8 million bridging loan that Poseidon is due to repay to him on Tuesday, which also appears to be a factor in the timing of the board ructions.
Mr Forrest lent the money to Poseidon in April 2012 and the deadline for repayment has already been delayed once.
Poseidon has been scrambling for extra funding over recent months but has so far been unable to raise the $200 million it needs to continue drilling the Windarra nickel deposit in WA.
The company had just $4.7 million in cash at June 30 and the lack of funding and the depressed nickel prices forced the company to lay off scores of workers in July.
Mr Forrest and other directors of the company had been collecting their fees in the form of shares, in a bid to preserve cash.
With other board changes also being considered, Poseidon may remain in a trading halt until Tuesday.
Mr Forrest's departure comes 11 months after he spruiked the company's stable boardroom as a sign of its strong drive to bring the Windarra project back to life.
"I can offer no greater insight into the focus and determination of this team other than to point to the fact that the board and the senior management team are the same today as they were when Poseidon started," he said in October 2012.
Windarra was at the heart of the nickel boom that briefly swept Australia during the 1970s.
The commodity has been dogged by very low prices in recent years, with many nickel miners, including BHP Billiton, struggling to make a profit on their mines.
Mr Forrest joined the push to revive the mine in 2007, when the company was named Niagara.
He remains its biggest shareholder with close to 30 per cent of shares on offer. He is also the biggest shareholder in Fortescue, with a stake of just under 33 per cent.
Mr Forrest's charities include "GenerationOne", which seeks to improve indigenous job opportunities, and the Walk Free Foundation, which is focused on ending slavery.
Poseidon last traded at 14.5¢, after fetching closer to 11¢ over most of the past month.
Frequently Asked Questions about this Article…
According to the article, Mr Forrest resigned after more than six years as Poseidon Nickel's chairman. His spokesperson said his priority is his philanthropic work and his role as chairman of Fortescue Metals Group. The announcement did not reference the $8 million loan repayment that is due to him.
The article says Mr Forrest lent Poseidon an $8 million bridging loan in April 2012. The loan's repayment was due the Tuesday following his resignation; the deadline had already been delayed once.
Poseidon had about $4.7 million in cash at June 30, the article reports. The company has been scrambling for extra funding and has been unable so far to raise the roughly $200 million it says it needs for the Windarra drilling program.
Poseidon needs around $200 million to continue drilling the Windarra nickel deposit in Western Australia, according to the article. The company has been trying to raise that funding over recent months without success.
The article notes that depressed nickel prices have hurt the industry. Many nickel miners, including major companies like BHP Billiton, have struggled to make a profit. For Poseidon, low prices and lack of funding led to layoffs in July and increased financial pressure.
Yes. The article says Poseidon may remain in a trading halt until Tuesday as other board changes are being considered and uncertainty around the loan repayment and boardroom moves persists.
To conserve cash, the article reports that Mr Forrest and other directors have been taking their fees in the form of shares rather than cash.
The article states Mr Forrest remains Poseidon’s biggest shareholder with close to 30% of the shares on offer, and he is also the largest shareholder in Fortescue with a stake just under 33%.
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