China Dairy Corp udderly rejects ASX questions about shadow director
Health & Biotech
Health & Biotech
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Dairy operator China Dairy Corporation has hit back at ASX queries about a potential shadow director, blaming his personal assistant for the mistakes, but their shares are still suspended while the market operator investigates.
Initial questions were raised of the company’s (ASX:CDC) governance last week, after emails surfaced from accused de facto director Mr Xiaoran ‘John’ Zhang, implying the retirement of board member Mr David Batten, a fact that had not been disclosed to the ASX.
Among other things, the ASX said suggestions had been made that Mr Zhang had unilaterally revoked a decision by the board on the company’s dividend distribution and arranged for himself to be a signatory on China Dairy Corp’s bank account in Hong Kong.
But China Dairy Corp say it was all a misunderstanding by Mr Zhang’s PA.
“Mr Zhang is not acting as a shadow director… The email was sent by Mr Zhang’s personal assistant, in error, on the basis of her misunderstanding of the 10 November 2017 board decision that Mr Batten resigned as director of the company as at 10 November 2017,” chair Enjia Liu said in his response.
“Mr Zhang had no knowledge of the email (and its content) at or before it was sent.”
Instead, they say the China-based Mr Zhang is a consultant and corporate advisor appointed by the company, appointed as signatory by four of five directors to facilitate payment of company expenses.
Correspondence between the ASX and China Dairy Corp has been publicly released as an announcement but, seemingly not convinced by their response, the ASX kept its shares in suspension pending further enquiries.
The raw and fresh milk manufacturer last traded at 6.6c to give it a market cap of $48 million.
They were listed on the ASX in April last year and raised $17 million in their IPO at an issue price of 20c.
In their last market update in September, the company was progressing its research and development into children’s milk specifically enhanced with vitamins fed into the cow fodder.
Shares in the company have traded between 6.5 and 15c in the past 52 weeks.