Activist investor Bramson wins battle for UK's Electra
By Freya Berry
LONDON (Reuters) - Activist investor Edward Bramson staged a dramatic coup at British private equity firm Electra, narrowly winning a seat on the board and prompting the resignation of its chairman after almost two years of battling management and its strategy.
In a tense shareholder meeting on Thursday, investors in Electra, whose holdings include the restaurant chain TGI Fridays in Britain, voted 53.5 percent in favour of the resolution by Bramson's investment vehicle Sherborne to appoint Bramson to the board.
Barely two hours later Electra Chairman Roger Yates announced his resignation, to be replaced for now by non-executive director and former Bank of England Monetary Policy Committee member Kate Barker. The company said it would seek a new independent chairman.
The enigmatic Bramson has become the largest shareholder in Electra, one of the City of London's oldest private equity firms, since revealing a holding in February 2014. He first attempted to join the board a year ago but was rejected.
Bramson has criticised Electra for a lack of openness and said there is more value to be found in the company's portfolio, although he has never given specifics on how that is to be achieved.
The bitter exchanges between the New York-based investor and the British firm have played out as a clash of personalities and cultures as much as a dispute over disclosure, board independence and debt levels.
A source close to the company said that, excluding Bramson who holds around a third of Electra's voting rights, just 15 percent of remaining shareholders who voted had backed the activist.
FIREWORKS
The stand-off lasted barely 45 minutes in front of an audience of about 60 in a conference room at London firm Allen & Overy -- a change from last year's grander setting in the historic Saddlers Hall, near St Paul's Cathedral.
A hush descended following Yates's announcement of the results. Bramson, flanked by advisers, declined to comment on his victory but did crack a smile.
Former Sherborne Chairman Ian Brindle will also join the board.
Despite the drama, share price reaction was muted. Electra's shares were down 0.3 percent to 35.85 pounds at 1510 GMT.
Sherborne will conduct a strategic review of Electra, just months after Electra concluded one of its own. That led to it slashing management fees and paying its first-ever dividend. Its latest results showed returns of 25 percent.
Bramson presently holds almost 30 percent of Electra. He has history with British financial institutions, orchestrating a 2011 boardroom coup at F&C Asset Management.
In a country unused to shareholder activism, it's enough to strike fear into any management's hearts.
The showdown came on Bonfire Night when Britons commemorate an attempt to blow up parliament by burning effigies of conspirator Guy Fawkes.
"A lot of us know who we'd like to put on top of the bonfire," said one private shareholder, in an impassioned defence of Electra before the vote.
(Reporting by Freya Berry, additional reporting by Emiliano Mellino; Editing by Elaine Hardcastle and Keith Weir)
