In an open letter sent last week to current 1414 Degrees chairman Tony Sacre, Dr Kevin Moriarty says a number of the company’s 3650 shareholders are “expressing dismay” with the way the company is communicating its progress.
Moriarty has also lodged a notice calling for a general meeting of the company to propose the removal of three directors, including Sacre, and the appointment of himself and Ian Burdon as company directors.
The open letter came just days after the company’s CEO Matthew Squire announced his resignation only 11 months into the job and just a month after a major investor abandoned 1414 Degrees’ flagship project.
Moriarty was the company’s executive chairman from July 2016 to September 2021 and oversaw its public listing on the Australian Securities Exchange in 2018.
Moriarty is the company’s largest shareholder with 12,653,000 shares – a 6.31 per cent stake in the company – according to its latest annual report.
“I am writing to express my concerns about the poor performance of the board and leadership over the 12 months since I retired from active management,” Moriarty wrote in the open letter seen by InDaily.
“As the substantial shareholder and previous executive chairman of 1414 Degrees Ltd, I have been contacted by many shareholders who have been expressing dismay with the inept communication of our progress and prospects.
“I have tried to reassure these shareholders, pointing out to them that the company is very much on track to deliver on their investment.
“This must be fixed and I am prepared to step onto a renewed board to lead the communications strategy and choice of new CEO to restore market and shareholder confidence.”
Sacre did not respond to multiple requests for a phone interview and would not answer InDaily’s questions about Moriarty’s letter.
However, the company announced to the Australian Securities Exchange yesterday that it had received a notice from Moriarty requesting a general meeting be convened.
“The Notice proposes resolutions for the removal of Mr Dana Larson, Mr Peter Gan and Mr Tony Sacre as directors of the Company, and for the appointment of Dr Kevin Moriarty and Mr Ian Ross Burdon as Directors of the Company,” 1414 Degrees said in yesterday’s announcement.
“The Company is reviewing and taking advice in relation to the Notice. If it considers the Notice to be valis, the Company will undertake the necessary steps to convene a general meeting in compliance with its obligations under the Corporations Act.”
1414 Degrees’ technology stores energy generated from electricity or gas as thermal energy by heating and melting containers full of silicon. Energy can then be supplied as heat and electricity in the proportions required by consumers.
The company’s share price nosedived in June 2020 following a review by Moriarty, which showed its technology was less efficient and reliable than previously forecast.
In June 2021, it announced it had formally parted ways with its managing director Jamie Summons after just six months, following an investigation into allegations of workplace misconduct.
Moriarty announced his retirement as 1414 Degrees executive chairman a few days later.
But things were looking up for the company in late 2021 following a partnership with oil giant Woodside to assess the commercial potential of 14D’s updated thermal energy storage technology SiBox.
Under the deal, Woodside agreed to contribute up to $2 million to allow 1414 Degrees to build a 1MW h SiBox demonstration unit.
The company was also making ground with its Aurora Solar Energy Project near Port Augusta and signed an MoU with Ovida to explore partnering in the development of the Aurora project.
The Aurora project has development approval for a 140MW battery energy storage system, 70MW solar-voltaic array and 150MW concentrated solar power generation as well as a 275kV ElectraNet connection to the grid.
Ovida announced in April this year that it would terminate its involvement in the project.
However, 1414 Degrees is pushing on with Aurora and last month engaged South Australian transmission network service provider ElectraNet to begin a Generator Performance Standard study, one of the last activities required to enable Stage 1 of the project to achieve financial close.
Moriarty said in his letter that many of the company’s shareholders were committed to the vision the company has communicated over the past five years.
“The initiatives I put in place have matured and are very promising for revenues from Aurora and our silicon technology,” he wrote.
“Our SiBox development is fully funded and our Aurora electricity storage project is on track to generate strong net cash flows.
“Our company has the only high-temperature energy storage solution for industries seeking to displace fossil fuel burning. This efficient heat storage also provides for a solution for baseload electricity supply.”
The Melrose-Park based company last month appointed two new non-executive directors, Sheree Ford and Alison Evans.
They join Sacre and other non-executive directors Peter Gan and Dana Larson on the company’s board.
Moriarty said 1414 Degrees did not need five directors, including two lawyers on its board at this stage.
“It is our shared opinion that the current Board, who have minimal if any shares in the company, are the wrong team to drive and promote this business, and have no deep understanding of what is required,” he said in the open letter.
“It only needs invested shareholders and people with experience and skill in entrepreneurial technology companies.
“Any replacement CEO should be able to communicate appropriately and therefore should be vetted by myself and experienced entrepreneurial directors.
“Accordingly I request that the current board not appoint a new CEO without consultation with and agreement of myself.”
1414 Degrees listed on the ASX in September 2018 after raising $16.3 million as part of its IPO. Its opening share price was $0.30.
The company has a market capitalisation of $15,33 million with a share price of $0.076 at yesterday’s close – about a quarter of its listing price in 2018.
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