Shareholders cry 'conspiracy' as Hibu is allowed go to the wall

Dissidents accuse directors of knowing firm's fate a year ago as funding is pulled

Furious shareholders in collapsed Yellow Pages owner Hibu have used a special general meeting to accuse the directors of a "conspiracy" to let the main company go to the wall, while preserving the value of its underlying subsidiaries for lenders.

"It stinks," Barry Dearing, lawyer for the dissident Hibu Shareholder Group, told the three-hour meeting which the directors, including chairman Bob Wigley and chief executive Mike Pocock, refused to attend.

Some investors complained of "daylight robbery" after Phil Bowers, partner at administrators Deloitte, explained Hibu UK, a subsidiary of Hibu plc, had withdrawn funding to the parent company, which led to the directors calling in administrators eight days ago.

Mr Dearing alleged the board had failed to inform investors that it was the subsidiaries which held key assets, including the Hibu brand, and claimed the future of the company had been "set" over a year ago – long before the shares were suspended in July 2013.

"If as appears to be the case, since October 2012, control of the subsidiaries has been outside the plc company, trading in the shares of this company on the stock market has been on the basis of a totally false premise," said Mr Dearing. "That information should have been disclosed to the market. The significant reason why they didn't disclose it is because they wanted to preserve the value of the subsidiaries for the lenders," he claimed.

Hibu, formerly known as Yell, was once a FTSE 100 giant but customers switched from printed directories to the internet and it failed to cope with £2.3bn of debt.

While shares in the main company have been left worthless, lenders are set to seize control of the subsidi-aries through a debt-for-equity swap that still values the business at around £1.5bn. Controversially, vulture funds have snapped up some of debt on the cheap and stand to benefit as the subsidiaries continue to trade.

More than 60 shareholders came to the meeting and most were livid. Sunita Cooke, a private investor from the Midlands, said: "We feel set up." Jim Corrin from the Midlands added: "It's absurd. It's as if the plc doesn't and never did exist as a holding company because it's the subsidiary company that has withdrawn the funding."

There were a series of other dramatic developments at the meeting:

* HSG's Mr Dearing took control to appoint 10 new directors on a unanimous show of hands.

* Deloitte admitted it advised Hibu's lenders for "six to 12 months" before being called in an as administrators. HSG claimed that was a conflict of interest.

* HSG said it had documents that showed Hibu's board had received two approaches for its US business, worth close to $1.5bn, in 2011 – yet shareholders were not told.

* Shareholders voted to contact the Serious Fraud Office.

Mr Bowers was applauded at the end for listening to shareholders. He said he was "happy to engage in dialogue" with the HSG directors, while insisting they have no executive powers because Hibu is in administration.

Hibu directors declined to comment but have always insisted they acted lawfully in the best interests of the company and shareholders.

Mr Dearing previously advised investors in collapsed doorstep lender Cattles and won them some cash.