Alliance Trust boardroom battle with hedge fund hots up

Pressure is mounting on Alliance Trust, one of the UK’s oldest investment companies, after an influential shareholder advisory body backed rebel investors pushing for change at the FTSE 250 business.

The move by advisory body ISS represents a boost for US hedge fund Elliott Advisors, which has a 12% stake in Alliance Trust and is calling for three directors it has selected to be appointed to the board.

Elliott wants Anthony Brooke, Peter Chambers, and Rory Macnamara to be voted on to the board at the annual meeting on 29 April. ISS said the three would be “beneficial for Alliance”.

But Alliance Trust is urging shareholders – including around 60,000 retail investors – to reject the new board directors. It hit back against the analysis by ISS saying: “We’re disappointed that the ISS report doesn’t represent many of the facts that we provided to them when compiling their research and in particular does not reflect our concerns over Elliott’s motives for proposing these candidates.”

ISS said that Alliance believes the campaign is being engineered to provide Elliott with an exit from its shareholding.

Alliance retorted: “ISS is entitled to a view, but we hope that shareholders will reach their own informed decision taking full account of the reasons why our board has made its recommendation to vote against the proposed candidates.”

Alliance is run by Katherine Garrett-Cox, whom, ISS said, has a salary close to the median for a FTSE 250 company but more than 50% higher than the average of financial services companies in the index.

Powered by article was written by Jill Treanor, for The Guardian on Thursday 16th April 2015 17.47 Europe/London © Guardian News and Media Limited 2010


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