Stillwater Mining Co. announced on May 20 that Brian Schweitzer, former governor of Montana, had been elected chairman of the company’s board of directors, replacing Frank McAllister. McAllister had served as Stillwater chairman and CEO since 2001. He will continue in the role of CEO and president of the company during an interim period while the board seeks a successor.
Stillwater owns and operates the Stillwater and East Boulder platinum-group-metals (PGM) mines in south-central Montana, the primary product being palladium. The company operates a smelter, refinery and laboratory at Columbus, Montana, to upgrade the concentrate to a PGM-rich filter cake and also processes spent catalyst material through its recycling facility to recover PGMs.
Schweitzer was one of four new directors elected to the Stillwater board at the company’s annual general meeting of shareholders on May 2. Beginning in February, the Clinton Group hedge fund campaigned for Stillwater shareholders to replace the entire board with a proposed slate of new directors. At the meeting, four of Clinton Group candidates were elected to Stillwater’s eight-member board, with Schweitzer being among the more vocal critics of Stillwater management.
The Clinton Group charged that Stillwater management had destroyed shareholder value by over-paying for acquisitions of the Marathon PGM-copper project in Ontario in 2010 ($133 million) and the Altar copper-gold deposit in Argentina in 2011 ($487 million); by over-paying its executives; and by over-spending on palladium market development through its association with the International Palladium Alliance.
McAllister and the Stillwater board responded that none of Clinton’s proposed group of directors had the qualifications or experience to run a mining company and that they offered no new strategy or detailed operating plan.
With the May 20 announcement that Schweitzer had replaced McAllister as Stillwater chairman, the Clinton Group got what it wanted.