Board hits back at investor
Board nominee ‘ineligible’ says First in row with rebel
Train and bus group is facing big questions
First Group has told its rebel investor Coast Capital that one of its nominees for the board is ineligible and his name has been scratched from next week’s specially convened meeting.
It has been requisitioned by Coast, a near-10% shareholder, which wants to remove six directors and replace them with seven of Coast Capital’s own nominees.
However, one of the proposed new directors – David Martin – has failed to meet a deadline seven days before the meeting to declare his willingness to do the job. The deadline passed yesterday.
“Accordingly, that Coast Nominee, Mr Martin, is not eligible to be appointed as a director of the company at the General Meeting,” First Group said in a statement.
“As stated in the Circular, the resolution proposing to appoint Mr Martin (resolution (j)) is therefore not valid and will not be put to the General Meeting.”
Today’s statement followed a 24-page document issued yesterday by Coast refuting First’s claims earlier this month, in which it called the investor an “opportunistic, self-interested player that is only interested in short-term gains”.
“FGP’s defamatory attacks and false statements about Coast have been a predictable demonstration of a chaotic and unqualified management team with a long track record of value destruction,” Coast said.
“Coast believes that real and lasting cultural and organisational change are needed more than ever at FGP. The only way to effect such change is through the appointment of highly qualified, diverse board members who have the requisite experience in surface public transport and a thoughtful plan which will create sustained long term value for both investors and other stakeholders.
“None of FGP’s current board members have essential prior experience in surface public transport, despite FGP’s suggestions to the contrary.”
First caved to Coast’s demands for a shake-up of the business when it announced plans to sell parts of its operations, including its UK bus operations and Greyhound coach business in the UK.
Coast said: “The proposed fire sale of the UK bus operations, which the company has run into the ground, is a clear admission by management that they are unequipped to operate surface transport businesses.”
A spokesman for First said: “Coast’s plans are inconsistent and irresponsible. They would leave the group with higher debt and they are not in the best interests of all shareholders or our wider stakeholders.
“Their aim is to seize control of the board of a UK-listed plc without paying a premium. Their documents continue to demonstrate numerous factual inaccuracies and misunderstandings about FirstGroup and our markets, despite the many detailed and clear explanations we have provided them.
“We have set out our strategy, which is based on facts and knowledge of the business. We are delivering that, at pace, with a diverse and independent board who have the skills and backgrounds to address the future needs of transport.”