Gavin Darby dodges a bullet at Premier Foods AGM

This blog gives you the latest topical news plus some informal comments on them from ShareSoc’s directors and other contributors. These are the personal comments of the authors and not necessarily the considered views of ShareSoc. The writers may hold shares in the companies mentioned. You can add your own comments on the blog posts, but note that ShareSoc reserves the right to remove or edit comments where they are inappropriate or defamatory.

At the Premier Foods AGM the CEO Gavin Darby survived the “decapitation” attempt with 59% of the votes for his re-election vs 41% against. But its clear that the activist Oasis is not going away any time soon and so the debate about accelerating the reduction of debt with a chosen divestment or two rumbles on. The board are making conciliatory noises and continue to talk to those who attempted the decapitation:

“Over recent weeks we have had discussions with a substantial proportion of the major shareholders, which has included listening to the concerns expressed by those whose support we have still to earn.  The Board will give careful consideration to all shareholders’ views. Discussions with shareholders will continue, including matters arising from voting at the AGM.”

“The Board is committed to continuing its strategy of improving performance and reducing net debt, while working in parallel to identify other strategic opportunities to accelerate the Company’s turnaround to create value for shareholders.”

But some of this is about the person best suited to implement the chosen strategy – its not just about the strategy itself. So, with Gavin Darby in such a precarious position one wonders if it might be best for him to stand down at an appropriate point if/when a suitable successor can step into the CEO role with the full support of all shareholders.

The voting turnout of 78% of shares in issue is high compared to less contentious AGMs and is not surprising given the amount of pre-AGM interest generated for this vote within the financial press and also by the activities of the proxy agencies commissioned by both parties. However, I would not be surprised if the vast majority of retail shareholders still failed to register a vote and they probably constitute most of the missing 22%. Such a shame that they are disenfranchised by the nominee holding system and take no part in these key decisions.

Mike Dennis – ShareSoc Director

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