One of the main beefs activist investor George Armoyan has with Sherritt executives and board members is their lack of “skin in the game.” Armoyan recently failed to get his slate of directors elected to the board of the underperforming nickel producer, but his Clarke Inc. still owns about 5% of Sherritt’s outstanding shares, and he’s been making money on that stake.
The good news for Sherritt shareholders: On Thursday, Sherritt CEO David Pathe filed a public market purchase of 6,700 Sherritt shares at $4.42 (in a spousal RRSP account he has control or direction over), according to Canadian Insider.
The bad news: Including Thursday’s buy, Pathe still only owns 76,038 Sherritt shares (or .03% of S.O.), according to our friends at INK Research. That hardly aligns his interests with those of shareholders. It was Pathe’s declaration that Sherritt was on the hunt for acquisitions in late December – after the sale of its coal and royalty business – that prompted Armoyan to go public with his concerns, after months of behind-the-scenes negotiations with Sherritt.
I don’t currently own Sherritt stock, although I’m watching it closely given the run-up in the nickel price and the fact their Ambatovy nickel mine in Madagascar is up and running. Sherritt was also recently a BNN top pick of a money manager named Jim Huang.