One51 shareholder group tries to oust board

A FRESH row is brewing at troubled Irish investment group One51 with a group of disgruntled shareholders plotting to remove the existing board and appoint four new non-executives in their place.

A two-page letter, seen by The Irish Times, was recently sent to shareholders outlining a proposal for an extraordinary general meeting to effect the changes.

The group is calling for the removal of chairman Denis Buckley, chief executive Alan Walsh and non-executive directors Noel Cawley, Guy Hallifax, Hans Droog, Jimmy Murphy, Hugo Maguire, Michael Long, David Martin and Finbarr O’Neill.

Mr Droog actually stepped down from the board on April 11th, while last week Mr Maguire, Mr Murphy and Mr O’Neill said they intended to retire later this year.

Their places have been taken by Mike Wynne, Rose Hynes, Paul Carroll and Noel Cregan.

Mr Buckley, Mr Cawley and Mr Martin have indicated that they will step down by the time of the company’s annual meeting in 2013. The rebel shareholders intend to seek the appointment of John Hegarty, managing director of One51 subsidiary Hegarty Metals; Colin Hayes, businessman Pascal Taggart and accountant John McStay to the board of One51.

Mr Hegarty was recently granted an injunction by the High Court preventing One51 from removing him from his position within the company. The case is expected to be heard in July.

The Limerick-based businessman, who sold his company Hegarty Metals to One51, is thought to be a main mover in the group seeking to overhaul the board of the company.

It is understood that the group has sought the support of One51’s former chief executive Philip Lynch for their proposal. The Cork man and his family own about 6 per cent of One51. Mr Lynch was sacked by One51 last year and is suing the company for the payment of €1.4 million in severance.

Mr Lynch led One51 through a major expansion in the years before the economic crash and was criticised by many investors for the losses racked up in recent years.

Ironically, Mr Lynch’s sacking followed a lengthy and bitter campaign for change at One51 by other disgruntled shareholders. At one point, Mr Hegarty was part of this group before pulling back.

One source indicated yesterday that the rebel shareholders could already have as much as 25 per cent support for the board changes but this could not be confirmed.

The group would need a majority of shares voted at a general meeting in order to remove or appoint directors at the investment company. One51 declined to comment yesterday.

Last week it reported a €110 million loss for 2011, having recorded a deficit of €105 million in the previous year. It took a €121 million exceptional charge in 2011, much of it relating to a goodwill writedown on assets acquired between 2006 and 2008. One51 has announced a two-year action plan to rationalise the business, reduce its €146 million net debt and invest in growth businesses.