6th Oct 2014 12:59
LONDON (Alliance News) - Electra Private Equity PLC Monday said it will launch a review covering its fee arrangements with manager Electra Partners LLP, its capital structure and distribution policy, shortly after shareholders rejected activist investor Edward Bramson's proposals to make changes to its board and lead a strategic review of the business.
Electra said it made the decision to launch the review, which will be led by Chairman Roger Yates, as a result of discussions with shareholders over recent weeks. It said the board will remain open to dialogue with shareholders during the course of the review, and will announce its conclusions as soon as possible.
"The board of directors of the company recognises that these are topics of particular focus for all shareholders and that a review of them is appropriate at the present time," Electra Private Equity said in a statement.
In response, Sherborne said it looks forward to hearing more from Electra about the "resultant actions" from the review.
According to the results of a general meeting, which took place at 1100 BST Monday, 61.78% of voting shareholders voted against the appointment of Bramson to Electra's board. Bramson has built up a 20% stake in the private equity investment trust through Sherborne Investors.
Shareholders also rejected the appointment of former Sherborne Investors (Guernsey) B Ltd Non-Executive Chairman Ian Brindle to Electra's board, with 61.78% of votes against the resolution.
The voters also opposed the proposed removal of current board member Geoffrey Cullinan from Electra's board, with 63.24% of the votes opposing the resolution.
About 28.8 million votes were cast in deciding the resolutions regarding the proposed appointments to the board, while 28.7 million were cast the deciding on whether Cullinan should remain on the board.
Sherborne Investors had claimed that its proposals could increase the value of shareholdings in Electra Private Equity by more than GBP1.0 billion with lower risks and less volatility than under the trust's current strategy. It had also accused the trust of underperformance.
The dispute became increasingly heated in the weeks leading up to the vote, with Electra accusing Sherborne of making "unverifiable statements" and "unsubstantiated claims" ahead of the general meeting.
Electra shares were Monday quoted down 0.9% at 2,578.00 pence. Sherborne Investors (Guernsey) B Ltd shares were flat at 100.25 pence.
By Samuel Agini; [email protected]; @samuelagini
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