2nd Dec 2022 21:59
(Alliance News) - De La Rue PLC should be open to being an M&A object, a major shareholder said on Friday after once again hitting out at the banknote printer's chair.
Crystal Amber Fund Ltd noted that a majority of De La Rue shareholders approved the re-election of Kevin Loosemore as the security products maker's chair. De La Rue said just under 83% of shareholders approved the re-election at a general meeting on Friday.
Crystal Amber Fund, De La Rue's second-largest shareholder, noted it was not the investor that called for the general meeting. Crystal Amber said it was De La Rue itself.
"Crystal Amber is not aware of another company where a board has effectively requisitioned a general meeting itself regarding the continuing role of a director outside the normal annual general meeting," the company said.
Crystal Amber in November hit out at Loosemore and called for him to step down. Since then, the company reported interim results which contained a caution that its "range of outcomes for adjusted operating profit this year is larger than normal".
"Despite obvious dissatisfaction arising from the latest profit warning, Crystal Amber understands that as a result of the material uncertainty going concern audit opinion, there is some concern that removing Mr Loosemore at this time might result in further instability. However, as De La Rue convened the shareholder meeting following private correspondence between Crystal Amber and the chairman, Crystal Amber believes that De La Rue is responsible for creating public instability," Crystal Amber added.
"Crystal Amber remains of the view that Mr Loosemore's actions and ability are an impediment to the release and return of shareholder value. This is evidenced by strategic errors, a share price 30 per cent below the level of July 2020 at which GBP100 million of rescue equity finance was provided, three profit warnings and the material uncertainty going concern audit qualification."
Crystal Amber added that it believes there is still "considerable strategic value" in De La Rue, although the company should "seek to participate in industry consolidation without delay" in order to maximise shareholder value.
De La Rue shares closed 2.3% lower 76.80 pence each in London on Friday, giving it a market capitalisation of GBP150.1 million.
By Eric Cunha; [email protected]
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