Greencore chairman Mr Bernie Cahill has stepped down following the rejection by shareholders of a special resolution at yesterday's a.g.m. allowing him to serve another year.
The resolution, to change Greencore's articles of association to remove the retirement age of 70 years which would have allowed 70-year-old Mr Cahill serve one more year, required a 75 per cent majority for success. But, following a poll requested by Mr Dermot Desmond's IIU Nominees, which holds a 14.4 per cent stake in the company, the proposal received only 69.4 per cent of votes cast in person or by proxy.
IIU Nominees had called for a poll on special resolution 3, which included a provision to delete the age limit. It also sought votes on three ordinary resolutions covering the re-election of directors to the board, one of which concerned Mr Cahill. These resolutions required only a simple majority. With only votes cast in person and by proxy counting, IIU's 26.8 million shares accounted for 30.6 per cent of the valid poll, giving it sufficient power to defeat the special resolution. Only 88,149,400 shares were voted.
Although Mr Cahill and his fellow directors received the required simple majority in the ordinary resolution for re-election, in his case it was subject to success on removing the age bar. As a result, Mr Cahill had no option but to resign.
Representatives of IIU Nominees at the a.g.m. declined to comment on the reasons behind its opposition to the resolution.
In a short statement Mr Cahill, who has been chairman of the company since it was floated 10 years ago, said: "My reappointment was subject to the passing of a special resolution at today's a.g.m. While the special resolution was supported by 69.4 per cent of the votes in the poll, it was not passed by the required majority and, as a consequence, I am retiring from the board with immediate effect."
The failure of the resolution to be passed represents a considerable blow to board and management at Greencore. It was at the request of the board that Mr Cahill went forward for re-election to help with the integration of British foods group Hazlewood, which it recently acquired.
But chief executive Mr David Dilger played down the significance of the setback and said it would not affect the company's plans for Hazlewood.
"It's a disappointment, a personal disappointment to all members on the board, but this company is bigger than any single one of us on the board," he said. "I am quite confident this company will go forward. From nine o'clock in the morning, it will go forward, business as usual."
Mr Dilger said the vote should not be interpreted as a heave against the board or management of Greencore.
"The shareholders are absolutely entitled to extend their votes as they see fit and I don't think you should interpret this as a heave," he said.
He rejected the suggestion that the vote was a sign of a measure of dissatisfaction with Greencore's performance and the board's handling of the company's strategy, in particular the write-off of £55 million (€70 million) as a result of its investment in Imperial Holly of the US.
"I don't think that would be a correct interpretation," he said.
