Posts Tagged ‘Andrew Price’

  • PaperlinX offers hybrids a majority stake ahead of AGM

    A 250 shares for one security swap will potentially give hybrid security holders a controlling 54% of the troubled paper merchant if they all accept the terms. According to the company, hybrids who knock back the $14 offer are likely to be out in the cold after the deal goes down.

    The tortuous wrangling between PaperlinX and its step-up preference securities investors (hybrids) is coming to a head with the confirmed offer to swap 250 ordinary shares for every hybrid security. The hybrid investor support group (PaperlinX PIGS) has already knocked back the contentious deal but the board is confident it will be picked up by a good number of investors with a short-to-medium investment time frame.

    The majority of hybrid holders are a long way off from the original investors who got burned with the $100 securities when they were offered in 2007. Since then the securities have dropped 88% and most of the original investors bailed out, taking whatever they can get. The swap offer is pitched at making it attractive to the new investors, representing a 16.7 % premium at the closing prices on 21 August. The company warns those hybrid holders who do not accept the offer that they are likely to become minority security holders with potentially less influence over the future direction and control of the PaperlinX SPS Trust.

    There are few conditions to the offer and no minimum acceptance condition, which means that whoever takes it up gets the PaperlinX shares. It is unlikely that sufficient numbers will accept to change the majority control of the company.

    The alternative is that the hybrid PIGs will continue with a legal challenge already before the courts to force a better deal, which is been contested. According to the company, a protracted legal challenge is likely to materially disrupt and undermine the company’s operations and stakeholder and financier confidence.

    The hybrid/share swap offer comes ahead of what is sure to be a rambunctious AGM in Melbourne on Friday where Andrew Price, CEO, will front his critics and supporters. He said he is confident the shareholders will pass every motion proposed by the board.

    The AGM will also be seen though the frame of a more assertive stance by the company to potentially libellous comments about its ability to operate as a viable concern. Jeremy Martin, president of the Paper Industry Charitable Trust in the UK found himself having to issue a public apology for comments he made at an industry function in March. In a statement he said, I made comments… I now recognise were understood by many to mean that PaperlinX is insolvent, cannot pay its debts and is a credit risk. I retract my comments in their entirety and I apologise for any embarrassment caused.

     This heightened level of scrutiny is likely to keep the AGM a little more sedate than forecast.

     

     

  • New PaperlinX CFO to move into UK head quarters

    Top end shuffles continue at PaperlinX with the company announcing this week the appointment of its new Chief Financial Officer, Richard Barfield, replacing the departing Tony Kennedy.

    Barfield, who will be based at the company’s UK head quarters, has most recently worked with two publicly listed companies, Northgate Plc, a UK-based commercial vehicle hire company active in several European countries and Spring Plc, a UK-based recruitment business.

    The company has publicly been on the hunt for a new CFO since early April when it announced that Kennedy would retire from his role on June 30 this year. While PaperlinX chairman, Harry Boon maintains that Kennedy’s decision to retire was not prompted by the turbulent events and financial performance struggles experienced by the paper merchant over the last year.

    However, in a statement released this week by PaperlinX, the company’s CEO, Toby Marchant (pictured) cited the soon-to-be appointed Barfield’s track record in regard to managing company restructuring processes. In the statement, released on May 31, Marchant said:

    Richard is a highly experienced and well respected Chief Financial Officer who has recently completed the turnaround and sale of Bezier Group in the UK. His experience and track record of improving the fortunes of businesses through restructuring and well considered management of the balance sheet will be invaluable to PaperlinX.”

    The new appointment is a move that will be watched closely by outspoken shareholder figurehead, Andrew Price, who announced this week on Twitter his decision to base himself in Oxford in the UK from June 12 to keep abreast of PaperlinX developments as they occur.

  • PaperlinX shareholder insurrection picks up pace

    “If the EGM was held today, the result would be completely different,” said Andrew Price, PaperlinX shareholder activist as he prepared for the first Sydney meeting of disaffected investors on Monday. He was referring to the company meeting in March where he lost a bid to oust the current chairman by as little as two percent of the votes.

    The standing room only Sydney meeting was the latest in a series of presentations Price is hosting to inform shareholders about the state of the company and his own plans to revive its fortunes. Following a number of Melbourne meetings where he spoke to over 300 investors, both retail investors and other who have a stake in investment funds, he believes there is now a very strong appetite for change.

    “Many investors didn’t have enough information at the time of the last meeting. Over 30 percent didn’t vote. It is my intention to help investors become better informed to they can play an active role in the governance of PaperlinX,” said Price.

    The continuing activism comes in the shadow of the presentation of PaperlinX Strategic Review to be presented by Toby Marchant, CEO, June 30.

    Price has undertaken not to press for any further shareholder meetings, with the caveat that he will change his mind if the company tries to do, “anything stupid, such as sell a profitable business asset to try to cover up the mess they’ve made.

    “I sincerely hope they have a better plan for the future,” he said.

  • Andrew Price worries PaperlinX will go broke this year

    Shrugging off his recent defeat in an attempt to unseat Harry Boon as chairman of the paper merchant, Andrew Price is scornful of Toby Marchant’s promise to return the company to profitability by 2014.

    In a return to the guerrilla campaign he is waging against the board, Price describes the CEO’s plan as nothing more than a sham designed to buy time from the shareholders and avoid accountability. Price claims that Marchant is unable to forecast the sales and profit situation within the timeframe.

    “How can you credibly say that a reduction in overhead will restore profitability by 2014 when you admit that you have no idea what the sales and gross profit will be for the same year,” said Price in a press release.

    “At the EGM I pressed the Chairman to at least provide earnings guidance for 2012 and he refused. Trying to get the Boon/Marchant team to commit to foreseeable targets is like trying to nail jelly to a wall,” said Price. “I couldn’t care less about pie in the sky promises for 2014. I am worried about 2012 and the possibility of insolvency this year.

    The renewed criticism comes after members of the board, including Marchant increased their personal shareholdings in the company. This was a bone of contention at the recent EGM where Price accused the members of not backing their own company.

    There is no doubt the Price campaign is a continuing distraction for the company, which today announced a restructuring of its brands, rallying behind the name Spicers to better project a strong identity.

    Price has said he will not challenge Harry Boon again for the chairmanship of the company, but it appears that does not limit him from delivering trenchant criticism and dire warnings.

     NEXT WEEK! Don’t miss an Exclusive Feature here as Toby Marchant talks to Print21 on the challenge to the board posed by Andrew Price, the corporate strategy he believes will turn around the company and the future of the paper and printing industry.