US investor fires opening shot in battle for control of transport company Firstgroup
Transport company Firstgroup said today that activist investor Coast Capital has requisitioned a general meeting in an attempt to take control of its board of directors.
US investment management firm Coast Capital, which owns 9.77 per cent of the company’s shares, wants to remove six of the eleven current directors and replace them with seven of its nominees.
Read more: First Group losses worsen as new chief executive takes the wheel
Those it is targeting include chief executive Matthew Gregory and chairman Wolfhart Hauser.
Former chief financial officer Gregory was appointed as chief executive in November after previous boss Tim O'Toole stood down in May 2018 after a £327m annual loss.
Coast Capital founding partner James Rasteh said: "The existing leadership team has a track record of value destruction and under-performance".
And said: “The time has come to bring on board a leadership team with the vision, motivation and experience to deliver and execute a well-crafted turnaround plan."
Firstgroup rejected the plan and said its board was “focused on delivering shareholder value" and said it was "confident that the company has the right team with the right experience and plans in place to do so”.
It said it “regularly reviews its composition to ensure it maintains an appropriate balance of skills and expertise, and new board members have been added, as recently as earlier this month”.
Read more: First Group passenger revenue growth slumps following SWR strike action
The Aberdeen-based company, which is the UK’s largest bus operator, said it will “continue to engage with Coast Capital having attempted to do so constructively for more than a year”.
It said this has included detailed responses to several proposals and meetings with the chairman and senior managers.
Firstgroup is set to release its full year results and an update on progress and strategy on 30 May.