Spicers is facing yet another fight with its shareholders, with private equity firm Coastal Capital demanding the removal of the company’s finance director and CFO, Wayne Johnston.
Spicers is facing yet another fight with its shareholders, with private equity firm Coastal Capital demanding the removal of the company’s finance director and CFO, Wayne Johnston.
The Spicers’ board has thrown its full support behind Johnston, saying he has made an “invaluable contribution.”
The embattled paper merchant, formerly PaperlinX, seemed to have finally moved on from its long-running dispute with PaperlinX hybrid shareholders, after meetings last month of both groups of shareholders voted overwhelmingly in favour of a deal to break a deadlock that had restricted the company’s commercial and financial activities.
The agreement saw hybrid shareholders take a 68.3% percent stake in the company, with chairman Robert Kaye and non-executive director Michael Barker agreeing to step down and three new directors to be appointed.
After the meetings, Johnston told Print21: “The Spicers Board and management are extremely pleased with the outcome of the general meetings. The results of the meetings confirmed overwhelming support from both the Spicers ordinary shareholders and the SPS Trust unitholders for the proposal and we thank them for this.”
Now, Coastal Capital International, a New York hedge fund that held 19 per cent of the PaperlinX SPS Trust hybrid securities, has called for the removal of Johnston as well.
Spicers says it has received a notice from Coastal requesting that Johnston be removed as a director and be replaced by Coastal managing partners Todd Plutsky and Vlad Artamonov.
The fund began accumulating PaperlinX's step-up preference securities (SPS) several years ago, and in one 2012 purchase spent $3.5 million for an 8.24 per cent stake.
In an announcement this week to the ASX, the board says it respects the shareholders’ rights to remove Kaye and Barker but does not support the departure of Johnston.
The board believes that Wayne Johnston has made an invaluable contribution as a director in addition to his executive duties. It is the considered view of the non-executive directors that the continuity at board level that Johnston can provide as a director will be even more critical given the retirement of Mr Kaye and Mr Barker.
The matter will go to an extraordinary general meeting (EGM) in Melbourne on 6 September, where the company will “seek shareholder approval for the election of new directors.”
In its ASX statement, Spicers says:
As stated in previous company announcements, the board intends to nominate three candidates, identified via a company initiated executive search process, to be elected directors of the company; and it has also received nominations for eight candidates [including Plutsky and Artamonov] to be elected directors of the company.
The company says further details will be contained in the notice of meeting for the EGM, which will be issued no later than 6 August.