One51 to keep its stake in NTR despite fears over performance
Published 12/08/2011 | 10:39
ONE51 is likely to retain its stake in energy and waste management company NTR despite admitting its performance was still a "concern".
The investment company, which ousted its chief executive Philip Lynch last month, said its NTR holding had hit the whole business -- something the firm hoped to put right.
Writing to One51 investors, chairman Denis Buckley said the company "as it stands today has operating businesses and a diversified investment portfolio that has been adversely affected by its holding in NTR plc in particular.
"The One51 Group's investment in NTR remains a matter of concern for the board," he added.
One51 took a writedown of more than €130m on its NTR stake in 2010. The company has spent some €91m net on its stake to date and there is speculation that NTR boss Tom Roche may try to buy the stake for as little as €27m.
Despite expressing concern for NTR's performance in recent years -- the company announced a €280m annual loss last week -- there is little One51 can do with its holding. It is not believed a sale is being considered at the moment, however.
Interim chief executive Alan Walsh said NTR's material fall in value had "altered dramatically" the company's investment plans for renewable energy.
The company also confirmed its AGM will take place on September 14 -- almost 14 months after last year's raucous AGM. That meeting was marked by a torrent of criticism from the floor of the company's corporate governance policies and saw a failed move against Mr Lynch by disgruntled shareholders.
Since that meeting, One51 commissioned a review of its corporate governance policies by Grant Thornton.
The report, which was completed at the end of last year, found that "with the exception of some limited gaps", the company was "in compliance with the best practice laid down" by accepted governance standards.
The company's comments came on the same day of the publication of One51's annual report, which shows Mr Lynch is due a bonus of €740,000 which he has yet to receive.
It is understood Mr Lynch had been in talks to restructure his contract prior to his leaving that would have seen him take a 20pc pay cut and added short-term and long-term incentives. This was rejected by the company, however.
One51 has struggled since the downturn, with the company's shareprice trading at a less than a fifth of its 2007 peaks.