SABMiller witch-hunt causes stir among investors
August 13, 2009
 By Ann Crotty
SABMiller's corporate adviser, JP Morgan Cazenove, has caused a stir in investment circles due to its efforts to identify shareholders who voted against, or abstained from voting on, resolutions at the beer group's recent annual general meeting (AGM).
At last month's AGM, shareholders holding tens of millions of shares voted against, or abstained from voting on, three of the 19 resolutions. Resolutions that raised concerns related to the executive directors' pay, the authority to issue shares without allowing existing shareholders the right to participate in the issue and the authority to call a general meeting on 14 days' notice rather than 21 days. About 1.4 billion shares were represented at the AGM out of the total 1.6 billion shares in issue.
SABMiller spokesman Nigel Fairbrass said that this was not an unusual procedure and it was aimed at improving understanding between the group's board and shareholders. JP Morgan Cazenove had initiated the audit of the votes chiefly because it wanted to establish why some of the group's South African shareholders had voted against the resolution to allow for a rights issue without pre-emption rights.
While many fund managers and analysts said it was a highly unusual move, Claude van Cuyck, the head of equities at Sanlam Investment Management, said although it was not common, it was obvious SABMiller "has a very proactive investor relations team".
Van Cuyck saw nothing wrong with what SABMiller was doing to try to understand why shareholders were voting in a certain way. "We would give the necessary consent to disclosing the details of our vote in this sort of situation," said Van Cuyck. He added, however, that in general the anonymity of the present system was "probably a good thing".
An executive at Computershare, a custodian for many companies, could only recall one previous instance in which a firm attempted to identify which shareholders had voted against resolutions at shareholder meetings.
It is common practice at AGMs for shareholders to vote overwhelmingly in favour of whatever resolutions are presented. Resolutions traditionally secure the support of 95 percent-plus of shares represented at the meeting. The election or re-election of individual directors at the SABMiller AGM lured between 98 percent and 99 percent support.
But the resolution approving the executive directors' remuneration received support from only 85.7 percent of the shares. About 14 percent, or 194 million shares, voted against the resolution. An additional 24 million shares abstained. The voting reflected concerns about the generous pay packages awarded to chief executive Graham Mackay and finance director Malcolm Wyman.
The resolution granting directors the authority to allot ordinary shares for cash and not pro rata to all shareholders received support from 91 percent of the shareholders, with 9 percent against. The resolution giving directors authority to call a meeting at 14 days' notice means they will not have to adhere to a 21 notice day requirement called for in terms of the Shareholder Rights Directive due to start in the UK this month.
|
|
