Sugar faces defeat in buyout plan for Amstrad

ALAN SUGAR'S controversial proposal to take private Amstrad, the consumer electronics group he founded, was heading for defeat as the number of votes cast against the plan continued to mount last night.

The company is today expected to disclose the final count of proxies ahead of tomorrow's shareholders' meeting. There is a growing belief the proposals will be defeated by a convincing margin.

A spokesman said: 'The dice look stacked against us and, short of a last-minute change, the proposal faces defeat.'

Amstrad shares closed 1p higher at 25p yesterday.

In anticipation of the result, Amstrad yesterday announced that it would appoint two non-executive directors to its board. The posts are to be advertised later this week and a final shortlist of candidates will be drawn up by Pro-Ned, an independent body supported by institutional investors that specialises in finding non-executive directors.

The move follows persistent criticism from shareholders who say that Amstrad's board is dominated by Mr Sugar, its chairman and 35 per cent owner.

The company does not have any non-executive directors - one of the factors that led to the rejection of Mr Sugar's proposal by shareholders.

Although the company was advised by Kleinwort Benson, the merchant bank, and Touche Ross, its auditor, many investors felt that they were given insufficient independent advice on the deal.

Under the terms of the proposal, Mr Sugar offered 30p each to buy out the remaining shares he did not own, for a total of pounds 113m. But the company's net assets were valued at about 46p a share.

He has been fighting a losing battle due to growing opposition from small shareholders and institutional investors.

Prudential and Standard Life, the insurance giants, and Postel, the pension fund, have already declared their opposition and are likely to be followed by other large shareholders. The buyout requires approval from investors at a court hearing and a shareholders' meeting in the City tomorrow.

Last week Amstrad revealed that the tide of opposition was running against Mr Sugar. A total of 34.1 million shares and 3,932 shareholders had voted in favour of the proposals compared with 32.8 million shares and 5,511 shareholders against.

The majority of shareholders voting against the offer at the court hearing would be enough to block the buyout. Amstrad has 581 million shares in issue and 31,500 shareholders. Mr Sugar is not allowed to vote in the buyout.

However, a spokesman said that Mr Sugar would continue to work at the group even if his plans were rejected. 'He will not up sticks and go but feels that he has discharged his duties to shareholders with the buyout. However, if someone offers to buy his stake he may decide to sell.'

Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Recruitment Genius: Annuities / Pensions Administrator

Negotiable: Recruitment Genius: You will be the first point of contact for all...

Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

Ashdown Group: Learning and Development Programme Manager

£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...

Day In a Page

The saffron censorship that governs India: Why national pride and religious sentiment trump freedom of expression

The saffron censorship that governs India

Zareer Masani reveals why national pride and religious sentiment trump freedom of expression
Prince Charles' 'black spider' letters to be published 'within weeks'

Prince Charles' 'black spider' letters to be published 'within weeks'

Supreme Court rules Dominic Grieve's ministerial veto was invalid
Distressed Zayn Malik fans are cutting themselves - how did fandom get so dark?

How did fandom get so dark?

Grief over Zayn Malik's exit from One Direction seemed amusing until stories of mass 'cutting' emerged. Experts tell Gillian Orr the distress is real, and the girls need support
The galaxy collisions that shed light on unseen parallel Universe

The cosmic collisions that have shed light on unseen parallel Universe

Dark matter study gives scientists insight into mystery of space
The Swedes are adding a gender-neutral pronoun to their dictionary

Swedes introduce gender-neutral pronoun

Why, asks Simon Usborne, must English still struggle awkwardly with the likes of 's/he' and 'they'?
Disney's mega money-making formula: 'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan

Disney's mega money-making formula

'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan
Lobster has gone mainstream with supermarket bargains for £10 or less - but is it any good?

Lobster has gone mainstream

Anthea Gerrie, raised on meaty specimens from the waters around Maine, reveals how to cook up an affordable feast
Easter 2015: 14 best decorations

14 best Easter decorations

Get into the Easter spirit with our pick of accessories, ornaments and tableware
Paul Scholes column: Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season

Paul Scholes column

Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season
Inside the Kansas greenhouses where Monsanto is 'playing God' with the future of the planet

The future of GM

The greenhouses where Monsanto 'plays God' with the future of the planet
Britain's mild winters could be numbered: why global warming is leaving UK chillier

Britain's mild winters could be numbered

Gulf Stream is slowing down faster than ever, scientists say
Government gives £250,000 to Independent appeal

Government gives £250,000 to Independent appeal

Donation brings total raised by Homeless Veterans campaign to at least £1.25m
Oh dear, the most borrowed book at Bank of England library doesn't inspire confidence

The most borrowed book at Bank of England library? Oh dear

The book's fifth edition is used for Edexcel exams
Cowslips vs honeysuckle: The hunt for the UK’s favourite wildflower

Cowslips vs honeysuckle

It's the hunt for UK’s favourite wildflower
Child abuse scandal: Did a botched blackmail attempt by South African intelligence help Cyril Smith escape justice?

Did a botched blackmail attempt help Cyril Smith escape justice?

A fresh twist reveals the Liberal MP was targeted by the notorious South African intelligence agency Boss