Trust raised at South Wharf

Shareholders in South Wharf have accused the company's board of breaking a commitment to appoint independent advisers for any sale of its business.

John Collins, a solicitor who represents the shareholders, raised the issue at the South Wharf annual meeting yesterday.

Earlier this year, the shareholders he represents objected to the takeover of Ardagh Glass, which was demerged from South Wharf in 2003.

It was taken over by Caona, a company connected with major shareholders in both Ardagh Glass and South Wharf. Mr Collins has questioned whether the deal was good value for other shareholders. He claimed that the commitment given at the time of the demerger of Ardagh Glass to appoint advisers covered the subsequent sale to Caona.

He said that "the board of this company promised us that in the event of a sale of the business, its board would appoint a firm of investment bankers to initiate a competitive sales process in the interests of shareholders as a whole. The business was sold, and no investment bankers were appointed and no competitive sales process occurred."

Mr Collins said he raised the issue when two directors of South Wharf, Brendan Dowling and Dr Margaret Downes came up for re-election yesterday. He said he did so on the basis that it raised questions about whether shareholders could trust the board. He said that the chairman, Paul Coulson, said the questions were not relevant and the motions to re-elect the two directors were passed unanimously.

South Wharf declined to comment last night.