British Energy's chairman Adrian Montague and Polygon Investment Partners, the hedge fund leading calls for a better deal for shareholders from the electricity provider's proposed restructuring, met for the first time at the company's annual meeting in Edinburgh yesterday.
British EnergY's chairman Adrian Montague, and Polygon Investment Partners, the hedge fund leading calls for a better deal for shareholders from the electricity provider's proposed restructuring, met for the first time at the company's annual meeting in Edinburgh yesterday.
Polygon, which owns 5.6 per cent of British Energy, demanded to know why the British Energy board had ignored attempts to recapitalise the company in 2002/2003, and why the restructuring had failed to reflect the possibility that trading at the company might improve before it was complete.
Despite predictions that the meeting would be tempestuous, just 53 of the company's 230,000 shareholders turned up.
Outside the venue, Polygon and a number of private investors opposing the restructuring held placards expressing their anger at the deal. Inside, there were no fireworks and all resolutions were passed. The all-important shareholder vote on the company's restructuring was not on the agenda. This is expected to be addressed an extraordinary meeting later this year, by which time the European Commission is expected to have given its approval to the deal.
Mr Montague told critics of the restructuring that the deal was struck at a time when the company was on its knees and that there was no going back. Unveiled in October 2003, the deal will see shareholders get just 2.5 per cent of the company and warrants entitling them to a further 5 per cent. Bondholders and senior creditors will get the remaining 97.5 per cent of the restructured British Electric. "The company is in no position to choose not to restructure on these terms and we can't help those who want to challenge the deal," Mr Montague said.
He reiterated a prior warning that even if shareholders vote against the deal he will move to delist the company's shares and continue with the debt-for-equity swap. And for those hoping that a proposed rule change by the UK Listing Authority could stop him, Mr Montague warned: "If the rule change were to threaten to prevent the implementation of the restructuring, the company would have little choice but to consider delisting its shares in advance of the rule change becoming effective".
In a separate development, David Gilchrist, British Electric's technical director, announced his resignation. The company said it would replace Mr Gilchrist, "who left to seek new challenges".Reuse content