Photo-Me looks to infusion of new blood

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The Independent Online

Photo-Me, the photographic booth operator, which is caught in the middle of a shareholder revolt, is finalising the appointment of two new non-executive directors.

Photo-Me, the photographic booth operator, which is caught in the middle of a shareholder revolt, is finalising the appointment of two new non-executive directors.

The company, whose shares slumped in January following a shock profits warning, has been criticised by investors for the composition of its board. One leading institution has vowed to vote against the re-appointment of the chairman, Dan David, at Friday's annual general meeting unless a new deputy chairman is named. Photo-Me is understood to be close to filling that post and appointing one other non-executive, although it remains to be seen whether the new directors will be announced on Friday.

Mr David has become the focus of institutional discontent with Photo-Me, whose shares closed on Friday at 138p, less than a third of January's high of 436 1/2p. The concern centres on the lack of accountability of a board that figures prominently at the top of Photo-Me's share register. Mr David owns 18.19 per cent of the company, a percentage exceeded only by the 19.12 per cent controlled by Serge Crasnianski, the chief executive. Schroders, with 15.65 per cent, is the biggest independent investor.

Photo-Me has already begun to address another complaint - that its board is too big - with the resignation of its managing director, David Miller. Further departures are set to be announced at Friday's meeting.

The search for new blood, being conducted by Cazenove, Photo-Me's adviser, has been helped by a recent recovery in the share price from a low of 81 1/2p. The comeback has been sparked in part by the announcement of a deal with Eastman Kodak, which will see Photo-Me supply digital photo processors to the giant American photographic group. The contract could be worth £10bn to Photo-Me, analysts estimate.

Mr Crasnianski, a Frenchman who trained as a nuclear physicist and went on to become a prolific inventor, famously sold £7m of Photo-Me shares in January to finance his relocation in the UK from France. He was the inspiration for the decision to install internet and email facilities in Photo-Me booths.

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