ALAN GRAY MAKES DEMAND
Landmark vote to play out at Group Five
The clash with activist shareholders is around strategy and, crucially, Allan Gray’s nomination of Mike Upton as a new nonexecutive director
A landmark vote takes place on Monday at Group Five’s Midrand headquarters to elect a new board for the construction company. It is the first time that a shareholder — in this case Group Five’s 25% owner Allan Gray — has demanded an entire board resign because it had "lost confidence" in the board. Some analysts describe it as a watershed, as SA’s economic slowdown has encouraged institutional shareholders to play a far more activist role. This case has also assumed political overtones. The Public Investment Corporation, which upped its stake in Group Five to 20.1% last week, is chaired by Deputy Finance Minister Sfiso Buthelezi — the brother of Group Five’s current chair, Philisiwe Mthethwa, who has repeatedly clashed with Allan Gray. While the clash between the shareholders is partly around strategy, it is Allan Gray’s nomination of Mike Upton, Group Five’s CEO until 2014, as a new nonexecutive director that has heightened tension. Mthethwa’s board has urged shareholders to vote a...
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