IAMGOLD Corp T.IMG

History -1B Dollar Float & Rise and Fall of its creator

[Luke555]

As a long time shareholder, I’d like to share the story about the origin of the 1B Dollar concept, and the rise and fall of its creator.  Interesting reading fot the Thanksgiving week-end. To simplify the reading, I’ve put it in point form- enjoy!

• The 1B dollar float idea was the brainchild of the infamous Stephen Letwin who was appointed President and CEO on November 1, 2010.
• With his background as an accountant, he was under the allusion that the best way to manage a mining company was that a strong Balance Sheet was the best way to go.  
• He was not overly concerned about the Profit and Loss statement, profitability or the return on investment for the shareholders.
• His single minded focus was to raise cash by anyway possible.
• To achieve his objective, he hedged the gold production and negotiated and completed all kind of deals involving the sale of assets, mining royalties and other frivolous company interests.
• In every deal negotiated, the company got the short end of the stick but, his primary objective was to raise cash.  He was well aware that you don’t raise a Billion dollars overnight.
• Under the Stephen Letwin regime we ended up being a financial organization rather than a mining company.
• Tragically of course, all these financial activities were at the expense of the shareholders who suffered financially and emotionally during his tenure as leader of the company. But that was the least of his concerns. He neglected his most valuable assets – THE SHAREHOLDERS.
• The concept of a strong financial position appealed to the large shareholders, hedge funds and other investment institutions. And that re-enforced him to believe that he was on the right course of action.
• Eventually, Mr. Letwin realized that his financial objective had limits for a mid-tier mining company by draining its assets. He had exhausted all the avenues available to him in raising cash.
• The charade went on for 10 years before he realized that his accounting background was not enough to carry him any further in the rough and tumble mining business.
• The shareholders were pummeling him daily on the bull board with negative sentiments running high and the bad press pressure got to him.
• On March 1, 2020 he handed in his resignation and resigned from the company.  

What a fitting end for a misguided mining executive…