Eurotunnel slates rebel plans as 'wild and dangerous'

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The Independent Online

Eurotunnel launched an unprecedented attack yesterday on a group of rebel shareholders who are seeking to oust the board, describing their plans as "dangerous, opportunistic, vague, pious, amateur, improvised, naïve, dishonest, wild, completely unrealistic and empty".

The ferocity of the attack and the level of vitriol reflects a nagging fear on part of the Eurotunnel board that the rebels might just win, given that 65 per cent of the company is in the hands of small shareholders, most of them French.

The rebel group, led by the one-time share tipster and convicted fraudster Nicolas Miguet, has succeeded in forcing a vote on its proposals at a special shareholders meeting in Paris on 7 April. They have put down a series of resolutions demanding the dismissal of the entire board of the Channel Tunnel operator and its replacement by a slate of French nationals.

Eurotunnel described the rebel group as "an alliance of convenience" and said that the vote was the culmination of months of repeated attempts by M. Miguet and the French shareholders association, Adacte, to destabilise the company.

As well as sacking the current board, the rebels want to force Eurotunnel's banks to cut the £6.4bn of debt they are owed and get the British and French governments to provide public funding for the tunnel. Eurotunnel has put forward an alternative set of proposals to the two governments, codenamed the Galaxie Project, which involves cutting access charges for rail operators by up to a half, merging Eurotunnel with London & Continental Railways - the state-backed consortium building the high-speed Channel Tunnel rail link - and issuing new bonds backed by future tunnel revenues.

The company said that if the rebel group had its way, shareholders could face a "total loss" because the banks would simply take control of the tunnel.

In a circular to shareholders ahead of the crunch vote in Paris, Eurotunnel said: "In contrast to the Galaxie project, this 'empty' programme cannot hope to address the legitimate concerns of shareholders. The board considers that this amateur and improvised approach cannot address Eurotunnel's fundamental problems." It goes on to ask: "Who are these men with their short biographies who are seeking to take control of your company?" and highlights the "abnormal" movements in the Eurotunnel share price which have accompanied the rebels' campaign.

The circular also says it is "incredibly naïve, if not dishonest" to suggest that Eurotunnel could unilaterally force its lenders to cut their loans with nothing in return.

To win, the rebels need only one more share than the board, irrespective of how many shares are voted.