Rebels oust former BAE chief at Spirent

John Weston, the chairman of telecommunications testing group Spirent Communications, was ousted at an Emergency General Meeting yesterday as activist shareholders Sherborne Investors took control of the company.

Four other directors will also leave alongside Mr Weston, a former chief executive of BAE Systems who also chairs struggling healthcare software group iSoft. The other directors voted out were Andrew Given and Fred D'Alessio, while Kurt Hellstrom and Marcus Beresford resigned after the decision by the majority of shareholders to back Sherborne's proposals.

Although Sherborne, a New York-based hedge fund, was most vocal in its attacks on the board of Spirent, it had support from other major investors including Credit Suisse Asset Management and Artemis Investment Management. Edward Bramson, chairman and chief executive of Sherborne, will take over as chairman of Spirent with Ian Brindle, Gerard Eastman and Alexander Walker joining the board.

Although the three rebel shareholders hold just over a quarter of the stock between them, with Sherborne holding almost 15 per cent, the resolutions to remove three board members were passed by a clear majority. Lexa, Spirent's second largest shareholder with 14 per cent of the company, backed the board but failed to drum up enough support from other institutional shareholders.

The proposal to replace Mr Weston received 54.9 per cent of the votes cast, as did proposals to replace Messrs Given and D'Alessio.

The new board at Spirent will look to increase profitability at its North American operations but, with a hedge fund in control, traders said a sale or break-up of the company now look the most likely outcome.

The defeated directors left investors with no doubt as to where they believe the company is heading. In a statement, the former directors said: "The long-term future of the company appears to have been largely decided on the basis of speculative potential for short-term share price gain rather than on the long-term success of the company."

Shares in Spirent closed 0.25p better at 55.25p, valuing the company at £562m including debt. The company, then called Bowthorpe, was once one of the stars of the dotcom boom and was briefly a member of the FTSE 100.