Hamish Champ: Shareholder power on display
Investor power was on ample display last week in Birmingham when 'activist shareholders' successfully forced out Mitchells & Butlers (M&B) chairman Simon Laffin and others at the company's AGM.
The build-up to the AGM had seen claims and counter claims from both sides of the argument coming in thick and fast, and with the vote likely to be both far-reaching and potentially controversial many of Fleet Street's finest were on hand to record the proceedings.
It was what some choose to label a 'media event'. I even got asked to appear on Radio Five Live's 'Wake Up To Money' programme at 5-bleedin'-30am on the day of the meeting to talk about it. You try being 'compos mentis' at that time of the morning after a night on the sauce. It's not easy, I can tell you.
As to the AGM itself, the atmosphere inside the International Convention Centre wasn't exactly electric but could've been legitimately labelled 'edgy'.
The end result of the day's proceedings was never really in doubt, what with the forces marshalled by those seeking change at the top greater than that which M&B could muster.
Yet while the protests from the 'minnow' investors were ultimately futile the strength of feeling of such individuals, their support for the business, impressed me. I expect bosses of other listed pub groups would give their right hands for such backing.
Once the floor of the meeting was opened up to questions, one after another small shareholders condemned the actions of Piedmont Inc. and Elpida, the two investment groups pressing for changes to M&B's board.
While a couple of small shareholders asked awkward questions of the board - notably on executive pay, the dividend 'no show' and the issue of property valuations - most were in support of 'their' company in the face of such… usurpers.
And when the man from Elpida, Ed Banks, announced himself to commence what was a long condemnation of the company's record on shareholder value he was greeted with boos and hisses. I desperately hoped for someone to shout out "He's behind you!", but sadly no-one did.
When Banks sat down only one person clapped (a colleague, perhaps?), versus the tumultuous reception that met every utterance of support for the board.
Small investors weren't expressing concerns in isolation. Some institutional investors also spoke out at what they saw as a worrying development in the management of the company.
The vote on the composition of the board went the way of the 'rebels', as most predicted it would. But while there was an inevitability to the proceedings it was heartening to see the 'little guys' air their views in a robust - if ultimately futile - way.
It's a funny old game, this capitalism lark…
