Manalto’s old board didn’t jump, they were pushed, say the new directors.

Last week the entire board of the struggling social marketing platform resigned after scrapping an acquisition of digital marketer Bambu.

Today, in response to questions from the ASX, Manalto’s (ASX:MTL) new board provided a withering explanation for why they were in, and Jim McKerlie, Paul Gardner and Michael Quinert were out.

“The new board understand that the existing shareholders had lost confidence in the outgoing directors being able to increase shareholder value and that the outgoing directors were unable to secure any ongoing financial support from existing shareholders or new sources of funding,” the company said.

“As a result, the new board understands that the outgoing directors decided to resign rather than to face the prospect of a shareholder requestioned [sic] meeting to consider a shareholder resolution that they be removed as directors.”

The Bambu acquisition failed because shareholders had concerns about the financial management of the company, the strategic direction, the lack of attention to selling the company’s actual products, and the dilutionary effect of a share-based deal.

The hits did not stop there.

The ASX asked what reference checks had been done on the new board members given the speed of their accession.

The new board said “presumably the outgoing directors undertook such enquiries” to check the suitability of their successors.

Two of the three new board members are familiar names for small cap boards, as is the new company secretary Elizabeth Hunt.

Dr James Ellingford, Ms Hunt and Terence Clee all work with Victory Mines (ASX:VIC).

Mr Ellingford is also on the boards of Creso Pharma (ASX:CPH) and Elysium Resources (ASX:EYM). He used to count Capital Mining (ASX:CMY) as one of his boards.

Ms Hunt performs the company secretary role for Zyber Holdings (ASX:ZYB), Wakenby (ASX:ILHDA), Chapmans (ASX:CHP), and Capital Mining. She is also the managing director of unlisted Mining Corporate.

Terence Clee sits on the board of Elysium Resources.

Tim Wilson is the only outsider, appointed at the request of major shareholders. 

The ASX also queried relationships between the new board, a new shareholder and Mr Wilson’s employer, EverBlu.

Stock Assist bought 5 per cent of the stock in early September and the three board members said they had no connection to the company.

Mr Ellingford and Mr Clee disavowed any connection to EverBlu.

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