Now Business Secretary is dragged into Sirius row amid fears ordinary shareholders will be shut out of vote
The Business Secretary has been dragged into the Sirius Minerals takeover battle amid growing fears ordinary shareholders will be shut out of a crunch vote.
Alok Sharma has been urged to speed up a review of City rules that make it hard for individuals to take part in major company decisions.
Concerns have been raised that a vote next Tuesday on whether Sirius should accept a £405million offer from Anglo American will not adequately represent the views of shareholders because many investors will find it difficult to vote.
Business Secretary Alok Sharma has been urged to speed up a review of City rules that make it hard for individuals to take part in major company decisions
Sirius, which is building a potash mine in North Yorkshire, has around 85,000 shareholders who own 50 per cent of its stock.
But many have their shares in nominee accounts through brokers or investment platforms, rather than owning them outright.
The only way they can vote is to go through a long and costly process to apply for a proper share certificate.
Odey says no to deal
Crispin Odey’s hedge fund will oppose the Sirius Minerals takeover after raising its stake in the miner.
Odey Asset Management, which last week branded Anglo American’s bid a ‘mockery’, now owns a 1.4 per cent stake, up from 1.29 per cent.
Henry Steel, manager of the fund that holds the shares, has submitted his proxy vote and said he had to vote ‘no’ unless Anglo amended its bid by 7pm.
He wants Anglo to raise its 5.5p offer to 7p.
But shareholder advisory groups ISS and Glass Lewis back the 5.5p bid. ISS said: ‘This transaction is the only viable option identified.’
If they don’t do this, their shares are included in a single vote put forward by the firms such as Hargreaves Lansdown and AJ Bell, which holds their stock.
Many Sirius shareholders have been angered by Anglo’s offer of 5.5p per share, which they believe is too low, and want to have a say, with some even suggesting they want to vote against it entirely.
Anglo needs 75 per cent of votes for the deal to go through.
In a letter to Sharma, Cliff Weight, director of investor lobby group Sharesoc, said: ‘The events at Sirius Minerals highlight how complicated the system to vote shares is and the need to make it easier.
‘Low rates of voting by individual investors will mean that opportunists can overly influence takeover outcomes.’
A spokesman for the business department said it recognised the system ‘can make it difficult for individual investors to have a say’.
Professor Sarah Green at the Law Commission, said the issues are being considered in a study for the department.