10/11/2016 - 11:40

Wellard shareholder plans AGM upset

10/11/2016 - 11:40

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Wellad’s third-largest shareholder says it plans to vote against the live cattle exporter’s remuneration report and has asked shareholders to back the appointment of one of its representatives to the board.

Wellard chief executive Mauro Balzarini. Photo: Attila Csaszar

Wellad’s third-largest shareholder says it plans to vote against the live cattle exporter’s remuneration report and has asked shareholders to back the appointment of one of its representatives to the board.

Butt Nominees, which is controlled by Pakistani meat producer Tariq Butt, said it would use its 14.4 per cent stake in Wellard to vote against the company’s remuneration report, a resolution to appoint Greg Wheeler as a director, and a resolution to approve the company’s executive share option plan at Wellard's AGM later this month.

“The final straw was Wellard’s refusal to distribute to shareholders a letter from Butt Nominees explaining why Butt will vote against AGM resolutions,” Butt said in a statement.

Wellard and its legal advisers took two days to tell Butt they considered the letter defamatory, a suggestion Butt completely refutes.

“Butt will be voting in favour of resolution nine, the appointment of Tyron Dennison as a non-executive director and Butt representative.”

Mr Dennison said Butt never intended things to become hostile with Wellard, but the company’s refusal to engage constructively with Butt left it with no choice.

Wellard was the worst float of 2015, has lost the confidence of the investment community and cost shareholders more than $450 million in destroyed market capitalisation,” he said.

Wellard’s board consists of only four directors – chairman David Griffiths, Mauro Balzarini, Mr Wheeler (CEO of Mr Balzarini’s private company) and Phillip Clausius – and clearly lacks independence and representation from non-Balzarini shareholders, who combined own about 80 per cent of the register.

“Butt, which through Tariq Butt has a long-standing relationship with Wellard and Mr Balzarini, has made clear it wants to help Wellard back onto its feet, and sees Mr Dennison’s appointment to the board as an important and appropriate first step.

“But Wellard’s refusal to let Butt explain the reasons for its AGM voting intentions and Mr Dennison’s nomination by blocking the release of a shareholder letter through the ASX platform is a further indictment of the Wellard board’s poor approach to corporate governance.”

In late September, Mr Balzarini sold a big portion of his stake in Wellard to a Chinese firm, but retained his status as the company’s largest shareholder with a 20 per cent interest.

Wellard’s second-largest shareholder is Chinese textile company Fulida Group Holdings with a 16.5 per cent stake.

Wellard shares were unchanged at 22 cents each at 11:30am.

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