National Express management and the transport group's deputy chairman, Jorge Cosmen, are set for yet another confrontation, this time over the terms that give the Spaniard the right to sit on the board.
The Cosmen family were granted a board seat when they sold the family business, Alsa, to National Express in October 2005. However, the terms of this deal are now under dispute as the board and the secretive family have interpreted them differently.
The National Express board believes that the Cosmens need a shareholding worth at least 8 per cent of the company to retain a seat. However, the Cosmens insist they only have to have around the same number of shares as they received for Alsa, 13.5 million, no matter what percentage of the stock this represents.
The dispute could turn nasty because the Cosmens are deciding whether or not to take part in a rights issue, whereby existing shareholders are offered new stock at a discount in order to raise cash. Should the Cosmen family decide not to take part in the share issue – they would rather take National Express private – their stake would fall below 8 per cent.
This would mean that other directors could try to kick Mr Cosmen off the board. "The Cosmens get a seat on the non-executive board as long as they have 8 per cent or more of the shares," said a National Express source.
However, a source close to Mr Cosmen countered: "Our understanding is that the relationship agreement that the Cosmens signed means that they are entitled to a seat on the board by the number of the shares, not the percentage that they represent."
National Express hopes to raise about £360m from the rights issue to tackle its debt burden. This means that the Cosmens would have to find around £60m to maintain the family's percentage share.
The company closed at 336p on Friday, a rise of 2.5 per cent on the start of trading.Reuse content