Shares in oil & gas firm JKX Oil & Gas (JKX) gained 2.9% to 61.8p following a counter response from the £106 million cap's largest shareholder to the current management's defence of its running of the business.
The war of words over the future direction of the Ukraine-focused group intensified this week with Eclairs, controlled by the Ukrainian billionaire Igor Kolomoisky, pressing for other investors to oppose the re-election of chief executive officer Paul Davies at next week's (5 Jun) annual general meeting (AGM).
In a letter to shareholders on Wednesday (29 May) the board said it believes this is an attempt by Eclairs to destabilise JKX at a key juncture in the progress of the company, and is an opportunistic attempt to secure control of its assets.
Eclairs', which owns 27% of JKX, response can be summed up by a comment from director Michael Bakunenko who said: 'JKX has failed to address the fundamentally poor performance of the company over several years which has resulted in a devastating destruction of value for shareholders, which, as JKX's largest shareholder, we find disappointing and illustrative of the board's attitude.'
Missed production targets on mature fields and delays to the full-scale development of its Koshekhablskoye field in southern Russia have seen the stock crash from a high of 543p in 2008 although some of the share price weakness can be attributed to the market's perception of political risk in the Ukraine.
More positively, a 2013 work programme, fully funded thanks to a $40 million convertible bond issue in January, got off to a good start on Thursday (30 May) with a sidetrack well on its Molchanovskoye North field in central Ukraine coming in ahead of expectations. House broker Oriel Securities, which has a buy recommendation on the stock, puts the group's net asset value per share at 125p.
JKX has since announced (at 11.24am) it has issued notices restricting Eclair and its shareholder ally Glengary, the investment vehicle of Russian businessman Alexander Zhukov, from attending or voting at next week's AGM.