11th Mar 2019 16:54
LONDON (Alliance News) - Crystal Amber Fund Ltd on Monday sent vehicle rental firm Northgate PLC a requisition notice to hold a meeting where a resolution will be proposed to remove Chair Andrew Page.
The meeting will also propose that Steve Smith, a former chief executive of Northgate be appointed as non-executive director.
Crystal Amber, which invests in small and mid-cap equities, said it believed that Page is the "principal driver of Northgate Group's lacklustre performance, both operationally and in generating value for shareholders, since he became chair in September 2015".
Crystal Amber pointed to the period between the first half of Northgate's 2016 financial year to the first half of 2019, in which the company's operating profit fell by 29%, and return on capital employed declined to 6.7% from 12%.
"We have finally lost patience with Page's refusal to listen to positive proposals to enhance shareholder value. He has presided over multiple profit warnings, a culture of inept communications with the market and, in our view, has failed to ensure there is the right mix of skills and experience on the board," said Investment adviser Richard Bernstein.
"Steve Smith led the team that grew Northgate successfully to the scale and market power it has today, a legacy that is being squandered by the current board led by Andrew Page. We believe that his track record as a very successful former CEO of the group and his unrivalled understanding of the commercial vehicle hire sector mean that his election to the board would be a huge boon for all shareholders," Bernstein added.
Shares in Crystal Amber Fund closed down 1.5% at 204.00 pence, while Northgate shares ended up 3.7% at 379.40 pence.
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