Fight with Elliott cost £3 million
Forseke admits Alliance Trust needs to ‘step up’ performance
The chairman and chief executive of Alliance Trust were today put under pressure at a packed meeting of shareholders wanting to know more about the eleventh-hour deal reached over control of the board.
After weeks of resistance, the board yesterday capitulated to demands from New York hedge fund Elliott Advisers to appoint new directors.
It accepted two of Elliott’s three nominees thereby avoiding what some believe was an inevitable defeat at today’s annual general meeting when a proposal to appoint the trio was due to be voted upon.
Roger Lawson of private investor group ShareSoc asked chairman Karin Forseke if she had considered resigning. She said her position was a matter for shareholders. Alastair Kerr, chairman of the remuneration committee, said she had the board’s full support.
Ms Forseke admitted the battle had cost the trust £3m in adviser fees, but shareholders were more interested in hearing an explanation for the u-turn and why they were denied the opportunity to vote on three nominees. One was applauded after saying she was “incredibly annoyed” that she had not had the chance to make her own choice.
Anthony Brooke and Rory Macanamara were accepted on to the board after accepting they would be independent of Elliott, but Peter Chambers agreed to step aside. The board will continue its search for an additional independent director.
There was an angry reaction from the meeting when Mr Brooke addressed the meeting and admitted to having limited knowledge of the trust.
Ms Forseke admitted there was a “clear message to us that we need to step up performance” and efforts would be made to ensure the trust did not find itself in this position again.
Despite some hostility in the media and among institutional shareholders towards chief executive Katherine Garrett-Cox, she was applauded by shareholders as she rose to address them.
She told the meeting in Dundee that the company had delivered consistently and had grown its dividend over 48 years. Reorganisation had reversed a long period of poor performance.
Mr Kerr defended Ms Garrett-Cox’s £1.34 million pay packet and denied that the management was overpaid compared to its peer group.
All motions were carried overwhelmingly. There was a small objection to the remuneration report with 6.7% of votes cast being against it.