Premier Foods launches charm offensive as top shareholder plans revolt
Oasis plans to vote against the re-election of chief executive Gavin Darby.
Premier Foods has kick-started efforts to quell a potential revolt aimed at ousting its chief executive after being blindsided by a top shareholder.
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The company’s chairman Keith Hamill is understood to be contacting investors to reiterate his faith in boss Gavin Darby following news that Oasis Management plans to vote against his re-election at Premier’s forthcoming AGM.
Oasis, which is Premier’s second largest investor with a stake of about 8%, also intends to encourage other shareholders to do the same.
Premier Foods, which is behind Mr Kipling cakes, Ambrosia custard and Bisto gravy, was caught unaware by the admission made by Oasis at a press conference in Japan.
The announcement prompted the board to issue a market statement backing Mr Darby and urging shareholders to follow suit at the AGM on July 18.
Premier Foods declined to comment any further.
Oasis is a major shareholder, second only to Japan’s Nissin Foods Holdings, which now holds a stake of around 19%.
Oasis’ plans are understood to have come as a surprise, given Premier recently delivered its strongest performance for five years, driven by sales of its Batchelors brand.
Revenue rose 3.6% to £819.2 million in the 52 weeks to March 31, while pre-tax profit rocketed 74.2% to £20.9 million.
Mr Darby has been in the top job since 2013, but came under fire from some shareholders when Premier was the subject of a takeover bid from US firm McCormick in 2016.
Shareholders in Premier previously vented their anger at Mr Darby for rejecting McCormick’s indicative offers, which valued the company at a 90% premium to its share price.
Instead of tying up with McCormick, Premier announced a collaboration agreement Nissin, which also took a non-executive position on Premier’s board.
Oasis recently terminated a “relationship agreement” with Premier Foods that had originally offered a seat on the company’s board in exchange for raising its stake in the business to 10%.
However, after failing to increase its holding, their representative quit the board in March just a year after they joined.
Oasis could not be reached for comment.