FirstGroup sees off activist investor, but chairman quits
Train and bus operator FirstGroup has defeated attempts by an activist investor to oust six board members, including the chief executive and chairman.
However, following the shareholder vote, chairman Wolfhart Hauser said he would step down from the company at the next annual shareholder meeting in July.
He said: “Having renewed the board through the appointment of independent directors with a diverse range of skills and expertise, focused on the future of mobility services, and overseen the appointment of Matthew Gregory as chief executive and Ryan Mangold as chief financial officer, to drive delivery of the strategy, it is now time for me to move on.”
A special meeting in central London on Tuesday saw shareholders overwhelmingly vote against US investor Coast Capital’s plans to install six of their own handpicked replacements.
None of the proposed replacements were elected either, with Steven Norris, former transport minister, who was one nominee, earning 36.36% of support – the highest of all those up for nomination.
Votes against the current board members varied from 25% for three board members, including chief executive Matthew Gregory.
Mr Hauser saw 29.33% of the votes go against him, and James Winestock, almost lost his seat, with 45.6% of shareholders voting against.
FirstGroup, which runs Great Western Railway, South Western Railway (SWR) and TransPennine Express, opposed the plans, but with Coast already owning a 9.7% stake, the company was forced to put the proposals to a vote.
The media was banned from attending the meeting, but shareholders said afterwards that they were disappointed with some of the responses from the chairman.
The meeting lasted nearly 80 minutes and involved questions from investors, including a Coast representative.
None of the nominees put forward by Coast attended the meeting.
Afterwards one private shareholder who asked a question, Anthony Lee, told the Press Association: “I think they [Coast] had a fair point about the lack of experience on the board of train and bus operators.
“But what I don’t agree with is the idea to leverage the company [by loading it with debts].”
He added: “What may be good from this is the shock it gave the company and just what it needed.”
Another private shareholder who attended the meeting, Henry Langley, said that, although he disagreed with Coast’s proposals, he had hoped the activist investor would have given more details at the meeting.
He added: “I was disappointed not to have the opportunity to hear from Coast. I also don’t feel the chairman gave very satisfactory answers to the questions posed.”
Angel Rizk, another private shareholder, said she asked the chairman when the dividend would be reintroduced.
She said: “They [FirstGroup] say they are going to sell the bus businesses – so why not give some of that money back to shareholders?”
Earlier this year FirstGroup said it would put its US Greyhound bus business up for sale and look at potentially selling its UK bus division too.