Time to grill One51 chiefs on bizarre events
There are 13 key questions the One51 board must answer at next Wednesday's AGM, writes Nick Webb
Shareholders ranging from beef baron Larry Goodman to Open-winning golfer Padraig Harrington and former Irish Nationwide chief Michael Fingleton are among those who have lost big time with a fall in the One51 share price.
The company ousted founder Philip Lynch in July in an extraordinary boardroom coup but little has happened since then.
One51 is holding its AGM next Wednesday at 11am in the Conrad Hotel in Dublin. Shareholders should grill Denis Buckley and the other directors about the bizarre goings-on in the firm and on what's going to happen to their investment.
1 WHY was Philip Lynch's contract terminated? The company has failed to give any reason except to say that they regret his termination of contract. If it regrets it why didn't the board create a smooth succession plan?
2 The writedown in value of One51's stake in NTR has been touted as the key reason for Lynch's ejection. Why was he the only executive held accountable? Why was Lynch's right-hand man -- CFO Alan Walsh -- elevated to the role of acting chief-executive?
3 Was the new acting chief-executive involved with the creation of the controversial One51 Patent Income Scheme structure used as a form of executive pay? Who were the nine other members of management who received bonuses from the scheme? Are there any directors, executive or non-executive, who received patent income?
4 Why did the €200m re-financing take so long to complete? The re-financing is a two-year solution to the previous five-year facility.
5 The board approved Philip Lynch's strategy in June 2011. On June 16, the re-financing was announced, yet, within two weeks, Lynch was ousted. Why was Lynch removed so soon after his plans were backed by the board? Why is the company paying Lynch two years' salary and as much as €1.5m in bonus payments, only to go off and pay other people to follow his plan?
6 Were the banks aware at the time of the re-financing announcement that the board was considering terminating Philip Lynch's contract? If not, what has been the banks' response?
7 Is Philip Lynch's strategy to sell off stakes in ICG and IFG in order to bring down debt by the end of the year -- adopted by the board in June 2011 -- still going to be implemented? Or, is the interim management planning to pursue the exact same strategy but over a much longer time-frame and why?
8 The masterplan was signed-off on on June 9, with the approval of the bank syndicate. Does the company have approval from the bank syndicate to deviate from this agreed plan?
9 The board stated in its announcement on July 1 that it would start a recruitment process. There has been no advertisements for the role of CEO -- why not? Is Alan Walsh considered the sole candidate?
10 The chairman stated he was concerned with the NTR investment and yet maintained they had no plans to sell it. If the writedown has been taken, why not sell it if it is a concern?
11 Noel Cawley made a statement at the AGM last year that he was unaware of the quantum of remuneration. From reviewing the Annual Report 2009, it shows that Dr Cawley attended every board and audit meeting. Why was remuneration not discussed at these meetings?
12 Independent advisers were appointed to review remuneration at the company last year, how is this process going? Did Philip Lynch agree to waive his service contract, reduce his salary by 20 per cent and enter a short-term incentive package? Were these proposals presented to the board? If so, why didn't it jump at them?
13 At last year's AGM, Noel Cawley said that Philip Lynch had an "old-style" attitude to corporate governance. A review by Grant Thornton of Corporate Governance was given to the board last year. Did the review find that One51 was in compliance with best practice or not?
Sunday Indo Business