Mystery investor set to stir up Tate & Lyle's board
Sunday 10 May 2009
A mystery European investor is set to challenge the board of Tate & Lyle, the struggling sugar refiner after amassing a "sizeable economic interest" in the company through equity derivative contracts.
Stock lending sources say that an activist is looking to "further shake-up" the management of the ailing business, which has issued two profit warnings in the past two months. However, the individual is not thought to be looking to pursue a full takeover. The buyer is understood to have a position worth more than 15 per cent of the company's shares.
Under current rules investors can secretly ambush companies by purchasing up contracts for difference (CFDs), which allow investors to get direct exposure to a company's share price, but does not confer voting rights.
CFDs are heavily used by hedge funds and cost only about 10 per cent of the actual share price, and means the buyer avoids stamp duty. CFD owners are able to convert their contracts into stock, which means companies can find themselves ambushed.
High profile examples of surprise CFD attacks include the attempt by Top Shop owner, Sir Philip Green, to buy Marks & Spencer. US investor, Samuel Heyman, played a key role in Nasdaq's battle to buy the London Stock Exchange, after scooping up around 10 per cent of the company's stock through CFD exposure.
However, under new rules being introduced in June, investors will have to disclose CFD positions worth more than 3 per cent of a company's equity, meaning the Tate & Lyle attackers have less than a month to reveal themselves.
Last month reports suggested that Tate & Lyle had hired the head-hunter, Egon Zehnder, to begin a search for a new chief executive, to replace Iain Ferguson, whose combative style is thought to have angered many in the City. Chairman, Sir David Lees, leaves later this year, while finance director, John Nicholas, left last September.
In April the company lost a key legal case in China over its Splenda, sucralose, patent, which Tate & Lyle claimed was being infringed by Chinese manufacturers.
Tate & Lyle's share price has slumped from more than 500p a year ago to 283.85p at the close of play on Friday. A spokesman for Tate & Lyle declined to comment.
- 1 East 17 bandmember Brian Harvey in 'very desperate situation’
- 2 Germanwings plane crash: Video shows co-pilot Andreas Lubitz learning to fly as a teenager
- 3 Vladimir Putin says Russia will fight for the right of Palestinians to their own state
- 4 Germanwings crash: Captain of doomed plane was only 'on board because he changed job to spend more time with his children'
- 5 WrestleMania 31 results: Seth Rollins stuns WWE as he cashes in Money in the Bank contract to claim title from Brock Lesnar
East 17 bandmember Brian Harvey in 'very desperate situation’
Vladimir Putin says Russia will fight for the right of Palestinians to their own state
Ohio Democrat Teresa Fedor speaks out during abortion debate to reveal she has been raped – and is interrupted by laughter from Republicans
Children take eight Isis captives to be beheaded in latest propaganda video
Jeremy Clarkson 'could be given minder' ahead of a potential Top Gear return
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
JK Rowling responds to fan tweeting she 'can't see' Dumbledore being gay
Street preacher quoting from the Bible fined for calling homosexuality an 'abomination'
Jeremy Clarkson sacked live: Alan Yentob 'wouldn't rule out' ex Top Gear host's BBC return
Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
The West has it totally wrong on Lee Kuan Yew
iJobs Money & Business
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
£32000 - £38000 per annum + benefits: Ashdown Group: A highly successful, inte...
£20000 - £35000 per annum: Recruitment Genius: This multi-award winning foreig...
Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...