disgrace director should resign, page-15

Let's understand a point here - financial journalists are covered by ASIC (as proper authorities, etc). They are also covered by the rules and regulations concerning media representation (ie: Media Council of Australia, etc).

In all circumstances, it is the Company's responsibility to address what is reported in the media - good, bad or indifferent.

As a company with direct involvement in South Australia, it is very likely that the Company and its Directors either knew, or should have known of the media report in the Sunday Mail. As such, the Company should have exercised its responsibility to request a trading suspension ahead of the commencement of trading on Monday.

I do not, therefore, see any basis for a claiming action (etc) against the journalist in question, the Sunday Mail, etc. Such is entirely puffery and should have been treated as such.

Now, as for the Company - well that is a different proposition.

According to its 2002 Annual Report, EBR has 4 Directors, including:
1)
Tony Rechner;
2)
Richard Diermajer;
3)
James Craib; and
4)
Terence Salotti.

All of the directors hold varying amounts of shares on both a direct and an indirect basis. To date, none of the Directors appear to have sold any of their holdings.

However, Salotti is also a non-executive Director of Wyllie Group Pty Ltd (having previously been its managing director for 12 years).

Wyllie Group Pty Ltd is also a major shareholder in EBR.

Tonight, Wyllie Group Pty Ltd issued a susbstantial shareholder notice which is confusing, to say the least.

The Notice bears out the following:
1)
A previous Notice was issued on 17 August 2000. At that time, Wyllie Group Pty Ltd held (with TPIC as the registered holder) 16.67% of EBR (or ~12.2M shares).
2)
On 15 May 2003, Wyllie Group Pty Ltd took up its one for 2 pro-rata share issue, resulting in the additional allotment to it of ~6.1M shares (@2c, or $121K). This was not disclosed until tonight's Notice was issued.
3)
On 15 September 2003, Wyllie Group Pty Ltd sold ~1.5M shares at an average price of 18.2c ($274K realised).
4)
On 16 September 2003, Wyllie Group Pty Ltd sold a further 1.9M shares at an average price of 9.8c (~$186K realised).
5)
According to tonight's Notice, Wyllie Group Pty Ltd still holds 14.8M shares (or 12.56%) vs the previously advised 12.15M shares (or 16.67%).

So, all things considered, at least one company associated with a continuing Director (ie: Salotti) sold 1.5M of its holding on Monday (before the trading suspension) and then a further 1.9M shares on Tuesday (following the lifting of the suspension).

If anyone has an issue concerning EBR's performance this week, then it should be with the Company, the Governance practises of its Board of Directors, and the continuous disclosure requirements practised by its' Directors and major shareholders.

Skinnin' the journalist /Sunday Mail is taking the easy way out when the circumstances that actually flowed appear more related to the conduct of the Company and its Board.

And, finally, just who were the particular shareholders who requested the re-wording of the report of 4 September (in plain English)?

The following is an extract from the re-issued report of 10 September 2003:

"On the request of shareholders and the ASX, EBR released more details of the Myall Creek drilling
to the ASX on the 4th September 2003. Shareholders felt strongly that the wording of the 4th of
September release was too technical and consequently EBR submitted the ASX report to First Communications Pty Ltd public relations consultants who have redrafted the release into plain language as set out below".

Simply put, the problems encountered with EBR yet again have everything to do with governance and lack of transparency in the Company adhering to its continuous disclosure obligations. This is no better evidenced than by the actions of Wyllie Pty Ltd (and TPIC Limited). Wyllie Pty Ltd (at a minimum) is associated with Director Salotti.