molopo board overthrow

I have been watching the machinations of the MPO s/h to oust a couple of the MPO directors incl the Chairman and CEO, and was surprised how successful they were.

What interested me was the difference in situation and outcome, between MPO and ICN.

ICN had the attempt by the Baldwins to effect change at ICN, then we had the protest votes by ANZ et al to vote down resolutions at the last AGM.

Both attempts failed at ICN.

It seems to me that the biggest impediment for change has got to be the stranglehold which RJ and his very large shareholding has over ICN.
The fact that he has a block of 26m? shares means that any contestant much garner at least that number of shares to even break even in votes.
That was the big difference with the MPO outcome - the directors had no where near enough shares to counter the block of shares that these big investors had built up within MPO.

the other big thing is that these investors presented a credible alternative of proposed new directors.

they also mounted a planned, comprehensive shareholder promotion to get s/h support.

they had money to fight for control

MPO directors used MPO money to mount a fightback of promotion, but the challengers obviously had the funds to counter the directors use of MPO funding.

This post is not making any comment wrt the current Board and Mgt of ICN !
It is just interesting to watch the outcome of a situation in MPO which had remarkable similarities to that of the previous situation at ICN.

cheers.

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SMH today:

Quick clean-up after Molopo landslide February 16, 2011
.Molopo Energy shareholders have removed their Beard (long-serving chairman Don Beard), but the market is itching to know how quickly the growth will come under the property mogul Max Beck's reform group.

Beck and his nominee, Greg Lewin, had the sort of landslide win at Molopo's shareholder poll, in the genteel surrounds of the Windsor Hotel in Melbourne yesterday, that politicians would envy.

Maybe Adipoetra Halim, head of the Halim Group, which is having plenty of trouble getting its controversial $260 million redevelopment of the Windsor off the ground, needs to give his rival Beck a call on how to win votes and influence people.

Not only did Lewin and Beck attract almost 70 per cent of votes, Beard and his fellow director, David Hobday, could muster only the support of a totally inadequate 35 per cent of the vote to keep them on the board.

Heading back to the office by tram yesterday, the Molopo director Geoff Phillips (chairman for little more than a month after Beard stepped aside for chemotherapy treatment) ruefully likened the defeat of the incumbent board to the ''it was time for a change'' factor that won the recent Victorian state election for Ted Baillieu and the Liberals.

By late afternoon Phillips was not only gone as chairman and a director, replaced by Lewin, but the chief operating officer, Ian Gorman, had been elevated to the top post after the chief executive, Stephen Mitchell (who has been at Molopo since 1999) managed a mutually agreed graceful exit at the first board meeting under new management.

Beck said he expected to be on the board for only six months, giving Lewin a tight timetable to produce results. Beck's last public company stint ended in early 2008 when he retired from the company he started, Becton Property. Even with his old golfing buddy Bill Conn as chairman, Becton shares are a miserable 5? now, compared with their $5 peak in 2007, and $3 when Beck left.

Investors will be hoping Lewin and Gorman, both with backgrounds at Shell, can get a better outcome at Molopo. Lewin, headhunted for the role by Beck via the executive search firm Heidrick & Struggles, is clearly focused on refining the company's operational spread in Australia and North America, which would cut out South Africa and India.

BIG TURNOUT

Apart from the defeat of the incumbent board, Molopo's meeting was extraordinary for the remarkably high percentage of votes cast.

Close to 55 per cent of Molopo's total issued shares were voted, nearly twice the 30 per cent average in such meetings and even more unusual in a company that does not have a large institutional presence on the share register.

With a market worth of less than $300 million, only a third of Molopo is owned by the 20 largest shareholders, leaving a lot of room for small-investor influence - three-quarters of its 8000 shareholders have less than $10,000 of shares.

Almost 100 investors, or stockbrokers representing them, turned up to vote at the meeting. One director noted afterwards that he had never seen so many of the company's investors at once, estimating it was about four times the number that normally came to an annual meeting. That number was also exceptional on a day when the mercury was tipped to top 30 degrees.

Specialist private client brokers were well represented, such as EL&C Baillieu's Richard Morrow, whose firm has been a long-time supporter of the company. Also in the thick of it was John Elliott's old mate and fellow Carlton supporter George Varlamos. He, along with his son David, suddenly decamped late last year from a long stint at Baillieu's to set up shop at Macquarie not long before the wheels were set in motion for the Molopo board challenge.

The former ballet dancer Li Cunxin, who heads Bell Potter's Asian desk and has clients anxious to see Molopo get more of its assets into production and lift the share price, said later he thought the changing of the guard was positive for investors.

The brokers' active presence, and the high individual turnout, show that the world has changed for company boards since the global financial crisis. It is not just institutional investors they need to wine and dine; small investors now understand the concept of corporate democracy and no longer meekly tug their forelocks to sitting boards.