UPDATE 1.35pm: Aviva Corporation is headed for a boardroom showdown over plans for wealthy mining company backer Ian Middlemas to join the company as chairman and kick-in $1.65 million via a placement.
Aviva emerged from a trading halt this morning to announce Mr Middlemas' planned appointment and the issue of 15 million shares at 11 cents each to his private company Arredo, as well as 10 million free four-year options exercisable at 17.5 cents.
The proposal is supported by board members Geoffrey Loftus-Hills, Lindsay Reed and Rob Kirtlan but Aviva's 14.6 per cent shareholder Sentient has opposed the move through its nominated director Pieter Britz.
After initially launching legal action to prevent the move, Sentient has lodged a requisition notice to have the independent directors removed from the board and replaced its own nominees.
The moves are set to be thrashed out at a shareholders meeting to be convened.
Aviva said a majority of its board had decided to hold off on its search for a new chief executive to replace Mr Reed until the matter was settled.
Under the Middlemas proposal, Mark Pearce would also join the company's board as a non-executive director.
Aviva is focused on the development of its Mmamantswe coal project in Botswana. In 2011, the company abandoned its previous plans to develop the Coolimba Coal and Power project, near Geraldton, after it failed to secure approval from the WA Environmental Protection Authority.Shares in Aviva soared 3.5 cents, or 25.93 per cent, to close at 17 cents after hitting a 52-week high of 18.5 cents in earlier trade.
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