ASX All Ords stock Dateline Resources Ltd (ASX: DTR) came under pressure yesterday after the company moved to address media speculation surrounding potential Rare Earth Elements (REE) tenements in the United States.
The Dateline share price closed down a sizeable 12.24% to 21.5 cents.
What sparked all this?
The situation began after an announcement from US1 Critical Minerals (ASX: USC), formerly Gladiator Resources, which stated that legal proceedings had been launched against Dateline's CEO, Stephen Baghdadi.
The implication was that USC was trying to gain control of certain promising REE tenements in the United States and that Stephen Baghdadi or the ASX All Ords stock may have been involved in some way.
Without doubt, the news created some investors to worry with the Dateline share price plummeting on the news. Dateline has now stepped in with this announcement to set the record straight.
Dateline pushes back on the claims
According to the release, Dateline said that while Stephen Baghdadi has indeed been pursuing additional REE opportunities following the Colosseum Gold–REE project, there are no arrangements of any kind between its CEO, or related entities and USC/Gladiator.
Dateline also made it clear that if it does secure more prospective REE tenements, those assets will be developed for the benefit of Dateline shareholders only.
The company firmly rejected any suggestion that the tenements would be transferred to another party, and said any legal claims against the company or its CEO will be vigorously defended.
Chairman backs the CEO
Chairman Mark Johnson also came out swinging, crediting Stephen Baghdadi and his team for an exceptional year. He said:
Dateline's exceptional year is owed to the outstanding efforts of our Managing Director, Mr Stephen Baghdadi and the team that he has assembled. Mr Baghdadi identified and negotiated the Colosseum opportunity and managed government and regulatory engagements in the highest levels of the Federal Government through to state, county and local authorities. His efforts have yielded significant value to Dateline.
Foolish takeaway
These kinds of disputes aren't unusual when companies are operating in competitive spaces like Rare Earths, especially where new discoveries can quickly attract attention.
Today's sell-off shows the market reacting to uncertainty, but Dateline's response aims to settle the speculation and reassure shareholders that the company remains focused on developing its REE opportunities.
