Hornby directors defend chairman
The directors of models and train set group Hornby are urging shareholders to reject a bid to remove chairman Roger Canham.
Activist investor New Pistoia, which owns 20% of Hornby, is backing Alexander Anton – a director of Kidderminster carpet group Victoria and a member of its founding family – in his bid to become the new chairman.
They say Hornby, which makes model railways, Corgi cars and Scalextric, has lost £31 million in five years under Mr Canham "and shareholders have lost enormous value".
A special general meeting is taking place on May 16 to vote on resolutions to replace Mr Canham and appoint Mr Anton.
But Hornby says its directors 'unanimously' consider the move is "not in the best interests of the company or its shareholders as a whole". And they are urging shareholders to reject the resolutions.
In its defence, the Hornby board of directors says its current strategy is "well thought-out and is working", the current structure and composition of the board is consistent with good corporate governance and the board has the support of a majority of its shareholders.
The directors also say they have the backing of major shareholders Phoenix Asset Management Partners, Ruffer LLP and Downing LLP who account for almost 54% of Hornby's shares.
Earlier this month Hornby has said the first stage of its turnaround plan has been completed, with the troubled toymaker showing early signs of a recovery after “structural improvements to the cost base”.
A string of profit warnings has resulted in Hornby’s shares plummeting over the past year as the Scalextric-to-Airfix firm has struggled with falling sales. A painful turnaround has seen it reduce product ranges and cut back on investment as part of plans to shore up the balance sheet.
