Will the reconvened extraordinary general meeting of Grand Parade Investments (GPI) actually take place next week?
The originally scheduled extraordinary general meeting was adjourned on the request of some shareholders wanting more information on why a consortium of activists are doggedly pushing for changes to the long-serving GPI board.
Those reasons have now been published at the behest of the JSE and make for compelling reasons why new oversight is needed at board level in terms of capital allocation and corporate governance.
The ongoing losses at GPI’s food businesses, especially Burger King, are clearly worrying. The tone of the adjourned meeting showed just how angry community shareholders are around the exchange of a chunk of GPI’s cash-spinning gaming assets for the cash-hungry food operations.
Surely there must now be a fair chance that the GPI board will seek a compromise before the extraordinary general meeting in order to head off another confrontation with disgruntled shareholders?
Sister publication the Financial Mail observed this week there has been some big volume action in GPI’s shares, with rumours that turnaround specialists Value Capital Partners might be taking an interest. The FM also picked up the presence of empowerment tycoon Iqbal Survé’s Sekunjalo Investment Holdings on the share register — although Survé emphasised he was merely embarking on a "value play".
The vigorous share trading activity might point to behind-the-scenes developments. A possible outcome is that executive chairman Hassen Adams stands down and retains a role as a nonexecutive, with at least two of the directors nominated by activist shareholders securing board seats. Whatever transpires at GPI — which trades at a deep discount to its intrinsic value — now wine drinkers are spoilt for choice any change can only be for the better.
Bidcorp and Bidvest went their separate ways back in May 2016. The official line is that the unbundling created two standalone companies with separate identities, clear focus and performance goals. The agendas for the two companies’ annual general meetings tell a slightly different story and remind us of how closely entwined the two were.
Brian Joffe, who founded Bidvest/Bidcorp 30 years ago, stayed on as a director at Bidcorp and has now entered into a consulting arrangement with the group. In 2018, This year, former Investec CEO Stephen Koseff wasappointed “independent” Bidcorp chairman. Koseff and Investec’s ties with Bidvest go way back to the early days of the acquisitive industrial/services conglomerate.
Presumably it’s because of that long association that the Bidcorp board decided it needed to appoint a lead independent director. That would have been good corporate governance if it weren’t for the fact that the lead independent director selected was Doug Band, who has ties that go back almost as far as Koseff’s. Band joined the Bidvest board in 2003 and is still a director there. He was appointed a Bidcorp director in 2016.
However, as one eagle-eyed activist shareholder pointed out, the similarities between the two entities is best seen in the detail of the annual general meeting notice.
Both made identical changes to the notice in the current year and both made the same mistake in those changes. Both companies have reduced the number of shares they wanted to put under the control of directors from 30-million to 16.75-million and both stated the lower number is 5% of the unissued shares in the company. Wrong. In both cases it is 5% of the issued shares. A small detail, perhaps, but a little worrying.
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