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TORONTO, Dec 24 (Reuters) - A group of activist shareholders plans to ask for several seats on Dominion Diamond Corp's board at a meeting with the company planned for early January and will seek to put forward its own slate of directors if it cannot oust the miner's chairman and its chief executive, according to a source familiar with the matter.
The investor group, which owns a 5.4 percent stake in Dominion and is led by Toronto-based hedge fund K2 & Associates, said in a filing this week that it believes the Canadian diamond miner's policies have hurt its share price.
The group is unhappy with the performance of Dominion CEO Brendan Bell and Chairman Robert Gannicott, said the source, who is an investor in Dominion and familiar with the situation but not authorized to publicly discuss the matter.
"My understanding is that if the group is unsuccessful in securing the resignations of the chairman and CEO, they will request a meeting of shareholders and put forward an alternate slate of directors," the source said.
On Thursday, Dominion announced the surprise resignations of two independent board members - Dr. Fiona Perrott-Humphrey and Ollie Oliveira - who have a wealth of experience in the mining industry. Dominion did not provide any detail, and said the two resigned for "personal reasons."
BMO analyst Edward Sterck said he has no reason to doubt the company's statement, but added that the timing is likely to lead the market to believe the events are linked to the pressure from activists.
The source dubbed the simultaneous resignations as too much of a coincidence to be normal course.
Perrott-Humphrey and Oliveira could not be reached for comment, and Dominion declined to comment.
The activist investor group has said it has concerns with Dominion's corporate governance, business strategy, capital allocation and other issues. It contends that Dominion's share price has "suffered excessively" due to the company's misguided policies.
Dominion's stock is down some 40 percent since early June.
The stock on Thursday closed 2.9 percent higher at C$14.03 on the TSX.
Dominion, which owns stakes in two of Canada's biggest diamond mines, has said it looks forward to an open dialogue with the investor group.
Dominion, on Wednesday confirmed reports that it had hired Rothschild as its financial adviser earlier this year to find ways to maximize shareholder value.
"There can be no assurances that any transaction will result from these matters," Dominion said. (Reporting by Susan Taylor and Euan Rocha; Editing by Leslie Adler)