THE directors of Lees Foods have won shareholder approval for their controversial buy-out bid for the company, although a sizeable minority of shareholders opposed their attempt to take the confectionery maker off the stock market.
Led by Lees Foods' chief executive Clive Miquel, the team won backing from the required number of shares at meetings in Edinburgh yesterday, paving the way for directors to complete their £5.6 million takeover of the firm.
Their 230p-per-share bid requires clearance, likely to be a formality, from the Court of Session at a hearing scheduled for June 11. There has been no sign that another bidder will emerge for the Coatbridge-based company.
Scotland seems likely to lose another of its relatively small band of listed companies.
While the buy-out team comfortably beat the required thresholds in a series of votes on the proposal yesterday, a significant number of shareholders voted against it.
One resolution was opposed by investors holding almost one-third (31%) of the 886,000 shares voted.
All the resolutions were opposed by at least 10% of the shareholders or shares concerned.
Members of the MBO team and interested parties could not vote in respect of their shareholdings.
Some shareholders have complained that the offer undervalues the company, whose range includes Snowballs.
David Stredder, a director of the Sharesoc private investor organisation, said he voted his 16,500 shares against all the resolutions.
"The valuation is ridiculously low," said Mr Stredder. "They had debt when they came to market (at 200p per share seven years ago) and earnings that were only half the level that they are now ... but they are wanting to disappear giving you an extra 30p."
Mr Stredder complained that as all the directors of Lees Foods are members of the MBO team, none were able to provide an independent recommendation to shareholders.
In the statement announcing a recommended bid approach issued on April 10, the company said the brokerage that acts as independent financial adviser to the board, Shore Capital, had recommended that shareholders accept the bid.
Mr Stredder claimed the outcome of the bid might deter small investors from buying shares in Aim-listed companies.
Yesterday's meetings had been delayed by a week to allow shareholders time to study Lees Foods' annual results, published four weeks after the bid was announced.
Last Tuesday, Mr Miquel barred The Herald from attending a meeting to sanction the delay in an attempt to limit publicity.
The Herald was allowed in to yesterday's meeting, attended by 13 people including advisors.
There were no questions from shareholders. Mr Miquel left after the meeting without taking questions from journalists.
Lees Foods issued a regulatory announcement detailing the results of the votes without commenting further.
At a court meeting of shareholders, 95 independent investors voted 725,016 shares in total in favour of a resolution to approve the takeover scheme, representing 83% of the shares voted.
Fifteen investors voted 149,707 shares (17% of the total) against the proposal. At the general meeting that followed 94 investors with 611,216 shares (69% of the total voted) supported the proposal.
Some 13 shareholders voted 274,507 shares (31% of the total) against it.
The Union of Shop Distributive and Allied Workers, which represents much of Lees's 270-strong workforce, has said the MBO would be in the best interests of its members.
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