Aur calls bailiff to seize shares pending lawsuit

On Aug 23, bailiffs walked into St. Genevieve’s head office and seized certificates representing 8.4 million shares of Societe Miniere Louvem (TSE). Aur tried to buy the shares from St. Genevieve earlier this year as part of a plan to secure control of Louvem’s Chimo Gold mine near Val d’Or, Que.

After the $8.3 million agreement fell through, Aur said it was suing both companies for breach of contract.

Aur is also seeking a declaration from a Quebec court that Louvem’s 50% stake in the Louvicourt Twp. zinc copper discovery east of Val d’Or is subject to dilution because of an alleged $40,000 default by Louvem. Aur now holds a 50% stake in the Louvicourt discovery. While St. Genevieve chairman Pierre Gauthier declined to comment on the raid, a spokesman for the company’s transfer agent who was also visited by the bailiffs, said he was sitting in his office when they approached him and served him with a notice of seizure.

“They asked me to put the shares in a safe place until they had requested a court ruling,” said Henri Beaudry, Central Guaranty Trust’s director of client services. The shares are now being held in trust pending the judgement.

Aur vice-president Howard Stockford, who was in Montreal recently to listen to evidence given by Louvem in realation to the Louvicourt dispute, refused to discuss the raid. But an Aur insider said that “since ownership of the shares is being disputed, why wouldn’t the court be able to hold them until the dispute is settled?”

According to the insider, Aur is concerned about a recent agreement between Louvem and Noranda Inc. (TSE) which gives Noranda an option to purchase 5% of Louvem’s shares from St. Genevieve.

“Obviously, Aur doesn’t want anything happening to the shares,” the insider said.

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