Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Abano board hits back at dissident shareholders

Abano board hits back at dissident shareholders

By Pattrick Smellie

April 10 (BusinessDesk) – Abano Healthcare chairman Trevor Janes has hit back at rebel shareholders calling for his resignation, rubbishing claims he was not independent and accusing his attackers of a campaign of “selective, deceptive, and misleading” comments.

Healthcare Industry and Steamboat Capital, which jointly hold some 19 percent of Abano shares, are behind the attempt to oust Janes by re-running part of the Nov 26 annual meeting, claiming Janes was not an “independent” director as claimed.

HIL is associated with Peter Hutson and Steamboat with James Reeves, who were involved last year in an Archer Capital-led takeover bid last year for Abano, which has dental businesses on both sides of the Tasman, as well as diagnostics, rehabilitation and audiology interests.

In a statement issued to the NZX this afternoon, the Abano board said it saw “no merit in the Hutson/Reeves comments and will consider whether further response is required in due course.”

“The board supports Trevor Janes as chairman and remains unanimous in its support of the company’s strategic direction and all its responses to Hutson/Reeves.”

The two shareholders claimed in extensive documentation released today that Abano consistently failed to meet its own forecasts of profitability, that its corporate dental business model was producing half the gross margin that a “one man band” dentist could expect to earn, and called for an immediate halt to planned dental business acquisitions in New Zealand and Australia.

They want Janes replaced as chairman in a first step to ousting the entire current board and a strategy review.

The Abano statement makes no reference to Hutson and Reeves releasing a critique by accounting firm Korda Mentha of a valuation report by Grant Samuel, which they say Janes should have made available to shareholders before last year’s annual meeting, rather than reading elements of it.

While Grant Samuel purported to be independent, they were in fact contracted to Abano, Hutson and Reeves claim. They also complained to the head of NZX Regulation about the timing of the Grant Samuel report’s posting on the NZX website.

They alleged a waiver from the NZX for directors of the Accident Compensation Corp potentially favoured Janes by allowing him to claim independence as chairman of Abano, despite ACC holding a 6.8 percent stake in Abano. That should have created a “disqualifying relationship”, the rebel shareholders argue.

The Abano board said it had taken legal advice and consulted the NZX before confirming Janes as an independent director “prior to the publication of the 2013 annual report and the 2013 annual meeting.”

“Subsequent to that, NZX has issued a class waiver relating to independent director requirements in relation to all Accident Compensation Corporation board members.”

“Regardless, Mr Janes’ independence is irrelevant and has no corporate governance implications for Abano as the number of other independent directors of Abano has at all times exceeded NZX requirements,” Abano said.

The company had also provided market guidance on March 18 for the 2014 financial year, which was “up on last year, ahead of brokers’ expectations and ahead of the forecast which was set out in Grant Samuel’s independent valuation report.”

Grant Samuel had reaffirmed its valuation report last month, in which it valued Abano’s shares at more than $9 a share, well above the initial indicative bid from the Archer consortium of between $6.97 and $7.14, subsequently raised to $7.80.

The Korda Mentha says that was $2.67 too high, on a mid-point valuation range basis and offers a revised valuation of $6.46 per share.

“We are disappointed that Hutson/Reeves continue to refuse to engage with the board, despite numerous invitations to meet with the full Abano board and/or board representatives,” the company said.

“We are not surprised, that Mr Hutson, who failed in an attempt to take over the company at benefit to himself above other shareholders, continues to attack the credibility and value of the company.”

Abano shares were trading at $7.20 on the day of last year’s annual meeting and had fallen as low as $5.90 by Feb. 4 before recovering to a high in 2014 of $6.80 at the end of March. In the first 10 days of April, they have fallen to trade this afternoon at $6.45, a 0.5 percent recovery on yesterday’s close.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news