By Shadia Nasralla
LONDON (Reuters) -Capricorn Energy said on Monday it was ready to add "a number" of people put forward by activist investor Palliser to its board while it pursues a merger with Israel's NewMed that some of its shareholders oppose.
Palliser, which is Capricorn's third-biggest shareholder and has spoken out against the proposed deal, last month called for a general meeting to vote on removing seven Capricorn directors from supervisory roles, including the CEO.
"We are ready to add a number of your nominees to the board promptly and well before the general meetings," Capricorn said in a letter to Palliser posted on its website.
Capricorn declined to clarify how exactly the board, which can technically be expanded by a handful of members, might change.
A spokesperson for Palliser said Capricorn's offer to add some of its nominees "appears to be little more than the latest manoeuvre by the existing directors, intended to limit shareholder optionality and protect their own tenures."
"It is Capricorn’s shareholders – not the existing directors – who should decide which candidates to appoint and, crucially, which directors should be removed," Palliser said in an emailed statement to Reuters.
Madison Avenue, Capricorn's biggest shareholder with about an 8% stake, on Monday separately reiterated its opposition to the board.
"Madison intends to vote for the Palliser slate of directors, against the current directors, and against the merger proposal," Eli Samaha, managing partner at Madison Avenue, said in an interview.
"We are disappointed and confused that the board continues to act in direct contravention to the desires of the largest shareholders of the company," he added.
Jamie Sherman, co-chief investment officer at Capricorn's second biggest shareholder Kite Lake, told Reuters on Monday the NewMed deal terms were inadequate and Palliser's slate of board nominees was the best way forward.
The shareholder meeting to vote on the board changes is planned for Feb. 1, with a shareholder vote on the NewMed deal "on or around the same date", Capricorn said.