Hong Kong billionaire Sammy Tak Lee has successfully blocked future non-pre-emptive share issues from Shaftesbury.
Shareholders at the company’s annual general meeting this afternoon voted against special resolutions which allow directors to allot shares on a non pre-emptive basis, and require 75% of shareholders to vote for approval.
Lee, who owns 25.02% of Shaftesbury’s issued shares, issued a letter on 29 January expressing concerns about the company’s non pre-emptive share issue at the end of 2017.
He said he would vote against resolutions 16,17 and 18 at the company’s annual meeting. These essentially allow the company to issue more shares.
At today’s AGM, resolution 16 was approved by shareholders. Resolutions 17 and 18 were not carried.
Resolution 16 is an “ordinary resolution authorising the directors to allot shares in the capital of the company” and needs 50% of votes to be passed. Resolutions 17 and 18 are special resolutions letting directors allot shares in certain circumstances on a non pre-emptive basis, and require 75% of shareholders voting in approval.
In a statement, Shaftesbury said: “At the annual general meeting Mr Lee, among others, voted against these resolutions.”
In a letter to shareholders earlier this month, Shaftesbury said: “Resolutions 17 and 18 require the approval of at least 75% of votes cast on the resolution. If Mr Lee votes against these resolutions, they will not be passed and the company will not be able to issue shares on a non pre-emptive basis (irrespective of the outcome of resolution 16).
“As stated in the notice of meeting for the 2018 AGM, the directors have no present intention of using the power under these authorities but, as in previous years, if passed, they would have the flexibility to act in the best interests of the company should the board see a clear need to raise equity.”
Commenting on the results this afternoon, Shaftesbury chairman Jonathan Nicholls said: “Following the successful placing in December 2017, at present the board does not anticipate the need to raise further equity for some time.
“Continuing investment in our portfolio will be funded using the remaining proceeds of the recent placing, existing, committed debt facilities and any new facilities which may be arranged in the future. The need to maintain a prudent balance between debt and equity, appropriate for a UK-listed company, is kept under constant review by the board.”
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