The war of words between online movie company Quickflix and a group of activist investors has heated up ahead of an extraordinary general meeting next week.
The war of words between online movie company Quickflix and a group of activist investors has heated up ahead of an extraordinary general meeting next week.
Quickflix revealed in April that a group led by US-based investment fund and former substantial shareholder Guaranty Finance Investors had called for the replacement of the company's existing directors with four new directors.
It has engaged turnaround advisory company Tournament Field, which says it is acting on behalf of investors dissatisfied with what they see as the poor financial performance of the company.
The group has launched an online advertising campaign in a bid to convince retail investors to support the motions and claims to have already won over more than 40 per cent of the company's major shareholders.
However Quickflix chief executive Stephen Langsford today rubbished the group's claims, saying the activist investors had "zero credibility" and were engaging in a transparent ploy to seek control of the company.
"This try-on from opportunists who see that the cheap way to get control of the company is by unseating its board will fail," Mr Langsford told Business News.
"Their reference to a claim that they’ve got 40 per cent of the vote – we don’t buy it whatsoever. We have the support of shareholders. We don’t pay any heed to people who are completely unqualified and have no commitment to the company or shares in the company."
A spokesman for the requisitioning investors this week claimed that the Quickflix board had failed to circulate documents relevant to the extraordinary general meeting to shareholders, as required under the Corporations Act.
Mr Langsford emphatically denied the claim, saying the company had been in full compliance with its obligations.
He said the company had already started the process of launching legal action against some investors in regards to allegedly defamatory statements.
"We’re operating a business in a high-growth sector with both challenges and opportunities up against serious industry players and this has been a complete waste of my time and the company’s time and money," Mr Langsford said.
The requisitioning investors claim they will increase the company's annual revenue to $150 million within five years, while lifting gross operating margins to more than 20 per cent.
The proposed new directors include British Academy of Film & Television Arts Los Angeles chairman Gary Dartnall and former Shine Group America executive Malcolm Reeve.
Shareholders will vote at the proposals at an extraordinary general meeting in Sydney next Thursday.