Chairman Wingate defends company against Merrill Lynch note
Erica Billingham
Robert Maxted, Chesterfield’s chief executive, and two other directors may face a call for their resignation, according to leading City analysts at Merrill Lynch.
Roberts Fowlds and Alec Pelmore this week suggested that Chesterfield directors who might have potential conflicts of interest in the sale of the company’s assets should step down now.
Last week, Chesterfield confirmed plans to break up the company and return money to shareholders. At the same time, it warned that the company’s net asset value is likely to fall below last year’s level of 612p per share.
Chesterfield has yet to reveal how the assets will be sold. But it is understood that Maxted and two other directors, Robert Cossey and David Henderson-Williams, are likely to have a role in managing the properties after they have been sold.
Maxted has been linked to a £100m portfolio under negotiation with GE Capital and Cossey and Henderson-Williams have been linked to a second portfolio that US fund Teachers is tipped to buy.
Fowlds and Pelmore said in a research note: “If [the breakup of the company] is the best alternative, shareholders might like to see the immediate resignation of any directors who intend to become involved with buyers, in order to allow a property auction to be held.”
But Roger Wingate, Chesterfield’s chairman, whose family owns 28% of the company, flatly rejected this suggestion and defended his board. “If there was a need for them to resign, they would have done so,” he said.
“I’ve run a public company for 30 years. We have a heavyweight financial adviser and non-executive directors. If there are questions of a conflict of interest, we are alert to them and know how to deal with them.”
Shareholders were this week waiting to see details of the transactions being drawn up by BT Alex Brown, Chesterfield’s merchant bank. Investors, who will vote on each deal, will be able to block the sales if they are unhappy with the terms.
Chesterfield’s attempt to deal with its huge discount to NAV by returning money to shareholders has been generally welcomed in the City. But analysts point out shareholders missed a chance to sell at more than 600p per share last summer when Chesterfield rejected an approach from MEPC.
|
Chesterfield shareholders |
|
|
Trustees of Harold Wingate |
14% |
|
CO Nominees |
14% |
|
Prudential |
14% |
|
PDFM |
12% |
|
General Accident |
5% |
|
Legal & General |
4% |
|
Source: Chesterfield Annual Report |
|
