The low-intensity civil war at chicken producer Sovereign Foods is likely to become more intense now that Country Bird Holdings (CBH) has bought up most of Sovereign’s smaller shareholders. But from here on, much of the battle might be fought out of sight of the media, which were used very effectively by the minorities who grew more militant with each attempt by the Sovereign board to push through a controversial BEE/management enrichment scheme.The minorities were unable to kill the scheme because a large block of institutional fund managers was as determined as the Sovereign board to push it through. Had it not been for CBH opportunistically joining the fray early on, it’s likely those minority shareholders would now be sitting with a smaller stake in a company whose controlling shareholder was a consortium comprising BEE partners and management.Of course, if the original scheme, with appraisal rights, hadn’t been scrapped, the minorities would have been able to bail at 850c. Inst...
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