Ronson overturns Crest Nicholson move to increase share capital

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The Independent Online

Gerald Ronson, the head of the property firm Heron, yesterday voted down proposals by Crest Nicholson that could have diluted Heron's 23.4 per cent stake in the housebuilder.

Gerald Ronson, the head of the property firm Heron, yesterday voted down proposals by Crest Nicholson that could have diluted Heron's 23.4 per cent stake in the housebuilder.

Mr Ronson, the property tycoon embroiled in the Guinness share-rigging scandal, has proposed to acquire Crest - an attractive target with its large land bank - but the group has repeatedly rejected his offer of up to £480m as too low.

The 65-year-old entrepreneur did not attend Crest's annual shareholder meeting, but sent his finance director Danny Kitchen to reject the proposals. One resolution, described as "standard" by Crest, would have given it authority to issue new shares up to an amount equal to 5 per cent of the existing number of shares, which would have diluted Heron's stake to 22.3 per cent and forced it to pay more for Crest.

The other resolution that was not passed due to Heron's opposition would have allowed the board to buy back up to 5 per cent of its shares. The proposals required 75 per cent acceptances.

Crest said it had not done any share buy-backs in the past five years, even though it had authority to do so. The group had planned to exercise the right to issue shares "in relation to the company's employee shares schemes". But a spokesperson said the defeat of the resolution would not affect the allocation of shares to staff and that in fact it did not need shareholder approval to do so. Last year, 586,726 shares were allotted to staff, 385,767 of which went to executives. The company emphatically rejected suggestions that the defeat of the resolution would cut executives' pay this year.

Heron had urged Crest shareholders to lobby the board to open its books, but no one heeded its call at yesterday's meeting in Egham, Surrey. The meeting, attended by about 100 mostly private shareholders, proceeded remarkably smoothly and not one shareholder mentioned the raging battle between Crest and Heron. One private shareholder asked for a valuation of the company, but John Matthews, the chairman, declined to provide a figure.

On the sidelines of the meeting, some shareholders said they thought it would be very hard for Crest to fend off Heron's advances and believed the company would end up being bought one way or another.

There has been speculation that Mr Ronson could be trying to flush out another buyer - should Crest be taken over for 500p a share, Heron would make £128m. Mr Ronson is thought to control about 20 per cent of Heron.

In a trading update, Crest said that more normal levels of trading had returned to the housing market after a sluggish end to 2004, but admitted that visitor numbers were still down on a year ago.

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