QXL rebels call for EGM over buyout

QXL Ricardo, the online auctioneer in the process of a management buyout valuing it at 700p a share, faces opposition from a group of rebel shareholders which could have enough support by tomorrow to force an extraordinary meeting.

Should a newly formed action group get the support of 10 per cent of shareholders, it will call for the meeting and try to get a memberon to the board as a non-executive, to voice its opposition.

The group, called QXL No To MBO, said getting enough support could be difficult as QXL has 8,500 shareholders, giving an average shareholding of just 200 shares. But it claims to have more than 3 per cent of shareholder support, including that of Neil Craven, the Swiss-based private investor who holds 2.14 per cent of QXL shares. Mr Craven said: "This remains a good recovery situation and the shares are still undervalued. This offer in no way reflects the true value of the company. There is no immediate need for finance, and regaining the Polish business [an issue going through the Polish courts] will immediately double group revenue".

The groupwants an investigation into the offer made for QXL and has asked its board for confirmation that neither eBay nor Yahoo! are interested in acquiring any of QXL's assets. It also wants to know how much the QXL directors will pay for their new shares should the buyout succeed.

The group claimed: "Shareholders are up in arms at what they see as a 'sweetheart deal' for managers and directors at the expense of shareholders.... Conservative estimates put the net asset value at between £20m and £80m or £15 to £40 a share."

Robert Dighero, QXL's finance director, said: "They [the group] are welcome not to vote on the buyout but should make sure they've done their homework properly. Most of the information they have asked for is in the offer document."