Tension can't stop company from getting what it wants
An often stormy One51 AGM descended into near farce at times yesterday with shareholders often bewildered by complex legal procedures as Phillip Lynch stared down the challenge from Gerry Killen's Campaign for Change at One51.
Mr Lynch sat silent while listening to both criticism and praise from shareholders, staring impassively at the masses that had crowded into the Shelbourne Hotel to find out what was happening to their company.
At times it was not a pleasant AGM for Mr Lynch who, over a three-hour period, endured measured criticism from many shareholders, including those from his own camp such as former Bank of Ireland boss Michael Soden, well-known businessman Paschal Taggart, a former Fine Gael minister who's a non-executive director of One51, and Noel Cawley, the chairman of state agricultural research body Teagasc.
The main issue going into the meeting was the so-called 'Chandela Affair', and the associated payment of patent royalties to nine executives within One51. Those nine executives still hadn't been revealed. Several requests for the names were turned down by Mr Lynch and One51 chairman Denis Buckley. while investors were told that it was a perfectly legitimate method used by companies to ease their tax burden, Noel Cawley, a non-executive director of One51, said the board had not been informed about the patent payments.
Mike Soden, a former chief executive of Bank of Ireland, said that he had seen a 65pc drop in his shares since he bought into the company. He said he felt that Mr Lynch and the rest of the board were "funding a lifestyle inconsistent with the company's results".
Mr Taggart criticised Mr Lynch's pay packet of €1.4m and queried why three chief operating officers had left in such quick succession.
Like nearly everyone who spoke at the meeting, Mr Soden and Mr Taggart tempered their criticism by adding that they still backed Mr Lynch and the company's investment strategy.
Time and again, criticism was followed by support for Mr Lynch. While his corporate ability may have been diminished in the eyes of some shareholders, it was clear that most investors still backed him.
When Mr Killen took the microphone, people leant forward in their seats, ears pricked. Mr Killen reiterated many of the criticisms he had levelled at Mr Lynch via the media prior to yesterday.
"This isn't about Phillip and I, this is about restoring shareholder value," he said.
Here was his moment. Here was the culmination of the campaign. But his pleas fell on deaf ears. The crowd's reaction of muted applause when he finished was almost enough to tell him his rebellion was already crushed.
In truth, the complexity of the Chandela arrangement may have gone over the heads of some shareholders. One51's chief financial officer, Alan Walsh, apologised in advance. Chandela was 100pc legitimate, we were told.
Those complexities reared their heads again when it came to voting in new board members. Amid a near shouting match between One51s legal advisor David Byers and Gerry Killen's adviser Sean Wallace, it seemed that the firm would not hold a straightforward election. Amid unruly scenes, Mr Wallace appealed directly to the floor for support only to be turned away. Ultimately, the company got what it wanted in every vote.