Laxey leads revolt at technology trust

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The Independent Online

Laxey Partners, the aggressive hedge fund group famous for demanding management change at British Land, has ousted the founders of a technology investment trust after leading a shareholder revolt over boardroom pay.

Laxey Partners, the aggressive hedge fund group famous for demanding management change at British Land, has ousted the founders of a technology investment trust after leading a shareholder revolt over boardroom pay.

The executive directors of Private Equity Investor were accused of setting up a "poison pill" compensation scheme which could have meant they would be owed more than the assets of the trust if it was wound up. Tim Childs, the Dublin-based investor and entrepreneur who founded PEI in 2000, and two other directors agreed yesterday to step down rather than face an acrimonious shareholder vote.

Laxey, which owns 27 per cent of the trust, had originally demanded a meeting to remove all four of the executive directors after discovering that they stood to share in a windfall of up to £80m if the trust was wound up. PEI has assets of just £64m. The trust and Laxey agreed to compromise proposals yesterday, which would cancel the compensation scheme in return for a payment of £1m. Mr Childs walks away with a £425,000 share of that money.

One of the four executives, Barbara Thomas, a former member of the US Securities & Exchange Commission, is staying on to manage the trust and oversee cost cuts, while three directors nominated by Laxey will be joining the board. Colin Kingsnorth, the Laxey fund manager who becomes a non-executive, said: "We are very pleased with the agreement, and plan to ... turn the trust into a more professional operation."

Mr Childs, whose previous ventures included the Dublin lease finance company Gatehouse, set up PEI under its original name, Net Investor, in February 2002. It raised £100m to invest in venture capital partnerships in the US, giving UK shareholders indirect stakes in a variety of start-up technology businesses.

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