(Reuters) - Gran Tierra Energy Inc, the latest Canadian oil and gas company to face a proxy battle with an activist investor, on Wednesday defended its board’s efforts to turn the company around.
West Face Capital Inc launched a bid on Tuesday to overthrow Gran Tierra’s board, outlining a plan to put up a slate of six nominees to replace the current four-member board, which it says has failed investors.
The Toronto-based asset management firm is critical of Gran Tierra’s efforts to build out its business in Peru, Argentina and Brazil, and wants the Calgary-based company to focus its attention on core assets in Colombia.
Gran Tierra, which has been hit hard by 10-month slide in oil and gas prices, said it is making significant cost cuts across its operations and is taking “decisive action to reshape the company and usher in a new era at Gran Tierra.”
The company also said it is focused on its Colombian properties and is curtailing spending elsewhere.
“We take the views of our stockholders seriously and have had, and will continue to have, conversations with West Face,” the company said in a statement.
The sharp fall in U.S. crude prices has activist investors eyeing debt-ridden energy companies, though most are waiting for the volatility to subside. Last month, Legacy Oil + Gas Inc formed a special committee to deal with hedge fund FrontFour Capital’s move to gain three seats on its board.
Shares of Gran Tierra closed up slightly at C$4.34 on Wednesday on the Toronto Stock Exchange.
Reporting by Julie Gordon in Vancouver; editing by Andrew Hay