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Activist investor Pentwater takes aim at Turquoise, Rio boards over CEO exit

Kitco News

March 5 (Reuters) - Activist investor Pentwater Capital Management LP on Friday condemned the surprise resignation of Turquoise Hill Resources Ltd's chief executive officer following pressure from the Canadian miner's top shareholder Rio Tinto .

Turquoise Hill said on Thursday Ulf Quelmann resigned, effective March 3, after Rio said it would vote against his re-election to the board. Pentwater, Turquoise Hill's largest shareholder after Rio with a 9% stake, said it believed the boards of Turquoise and Rio breached their legal obligations in the way Quelmann's departure was handled.

In response to Pentwater's statement, a Rio spokesman said the company supports the reset of leadership at Turquoise. Turquoise Hill did not immediately respond to requests for comment. During Quelmann's over two-year tenure as CEO, Turquoise found itself locked in a feud with Rio over how to fund the underground expansion of the massive Oyu Tolgoi copper-gold mine in Mongolia.

Rio is the operator for the mine and owns 51% of Turquoise Hill, which in turn owns 66% of Oyu Tolgoi. Pentwater did not detail what actions it plans to take and did not immediately respond to a request for comment.

(Reporting by Shariq Khan in Bengaluru; Editing by Sriraj Kalluvila)

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