TORONTO (miningweekly.com) – Brazilian gold miner Jaguar, which last month became the subject of takeover rumours, fell nearly 10% on Wednesday, after announcing the sudden departure of CEO Daniel Titcomb.

TSX-quoted Jaguar said last month it decided to “explore alternatives” to an unsolicited offer it received, and declined to comment as to why Titcomb was leaving so abruptly, though fund managers Mining Weekly Online spoke to suggested his exit might clear the way for a takeover.

Media reports emerged in mid-November that Chinese State-owned Shandong Gold Group had offered to buy the company for $1-billion.

Jaguar subsequently said it had received proposals, but “none of these proposals has progressed beyond the exploratory stage”.

Spokesperson Valeria Rezende DioDato declined to provide the reasons as to why Titcomb was leaving the CEO's seat, or say where the company was in its strategic review process, announced on November 16.

Speaking in a news release, Jaguar chairperson Gary German thanked him “for the value he has added to our company” and wished him well for the future.

German and Jaguar directors Gil Clausen and John Andrews will jointly act as CEO on an interim basis, the company said in a press release on Tuesday night. The firm announced Andrews appointement as a director on November 14 – two days before media reports surfaced regarding the proposed Shandong bid, citing anonymous sources.

Clausen declined to comment when approached by Mining Weekly Online.

German, Clausen and Andrews also form the special committee leading the strategic review.

First Asset Investment Management Inc senior portfolio manager John Stephenson said in an interview that Jaguar had been a "perennial money loser" under Titcomb's watch, and that he believed the board had asked him to step down.

"It’s just been one piece of bad news after another," he said of the company, which last month reported a $51-million net loss for the quarter ended September 30, despite record gold prices.

Stephenson said he believed Titcomb's exit had to do with the company's poor performance, as well as the possibility that he had disagreed with the board over a bid from Shandong.

Another fund manager, who asked to remain anonymous, agreed.

It was now likely that the reported $750-million bid from Shandong would proceed, said Stephenson.

"Given what we know, its probably going to happen," he commented.

Shares in Jaguar closed 9.2% lower on Wednesday in Toronto at C$6.62, valuing the company at C$558-million.

The company owns gold mines in Brazil, where it expects to produce around 160 000 oz this year.

Cormark Securities analyst Richard Gray said in a note to clients last month "the board of directors may
find a nice, easy, cash offer the better way to go". He wrote that, while the company's planned growth to 440 000 oz/y by 2015 held significant risk, "it remains the single most redeeming aspect of the company".
 

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