Myer board spill looking less likely after vote of support from Geoff Wilson
- Sep 16 2018 at 5:26 PM
- Updated Sep 16 2018 at 5:36 PM
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Wilson Asset Management founder Geoff Wilson has publicly declared his support for new Myer CEO John King. Kate Geraghty
A week ago Solomon Lew's Premier Investments was confident Myer shareholders would vote against the remuneration report at the upcoming annual meeting, triggering a board spill.
"[Chairman Garry] Hounsell must step down immediately or risk having his board spilled by a strong shareholder revolt at the upcoming AGM," Mr Lew said last Wednesday after Myer reported a $486 million bottom line loss and its seventh consecutive quarter of falling same-store sales.
Mr Lew, who had been sniping at Myer since Premier acquired a 10.8 per cent stake at $1.15 a share in March last year, finally saw his chance to appoint three of his own directors to the Myer board.
The Lew camp was unaware, however, that veteran fund manager Geoff Wilson had been quietly building a stake in Myer since early July following the arrival of new chief executive John King.
On Friday, after seeing Myer's full-year results, Mr Wilson's Wilson Asset Management Group, including WAM Capital, WAM Global and and WAM Leaders, lifted their combined stake from 4.9 per cent to 5.5 per cent.
Mr Wilson took the unusual step of not only publicly declaring his support for Mr King and his new team, he indicated WAM was prepared to play an active role countering Premier's campaign.
"The new CEO John King is a proven retailer with a strong track record, we believe his strategy will deliver," Mr Wilson told
The Australian Financial Review.
Far from being discouraged by Myer's full-year results, Mr Wilson said there were some encouraging signs and concerns about the company's viability were fading.
'There could be significant upside'
After falling almost 5 per cent the day the results were released,
Myer shares rose 37 per cent on Thursday to a seven-month high of 57¢ and gained another 4.4 per cent to 59.5¢ on Friday.
"There's a realisation the new management team is already starting to achieve positive results and there could be significant upside in the company from here," Mr Wilson said.
"As a shareholder our interest is in giving the new management team a stable environment to operate in."
Mr Wilson said Mr Lew's campaign against Myer was a waste of shareholders money and time.
"I don't know what [Solomon Lew] is trying to achieve - it's important he gives the new management team time to perform rather than throwing stones," Mr Wilson said.
"To me it's illogical when you have a new management team come in," he said. "If he wants to get his money back, if that's his objective, then it would be logical for him to
abstain."
Mr Wilson's move suggests a second strike against Myer's remuneration report and a board spill is looking less likely.
About 29.4 per cent of shares were voted against the remuneration report last year, representing a first strike, but excluding Premier's 10.8 per cent stake about 80 per cent of the shares voted were in favour.
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