AN activist shareholder group hoping to oust Aryzta chairman Gary McGann could be open to letting chief executive Kevin Toland remain on the board, it's understood.
The shareholder group that includes Switzerland's Veraison and Spain's Cobas previously said that it wants to remove Mr Toland from the board of the Swiss-Irish baked goods giant so he can concentrate on his CEO role.
But it now appears as though the investors - who between them control 17.8pc of the Cuisine de France owner - could be willing to compromise in relation to Mr Toland's position.
However, while it's believed that the investors might allow Mr Toland, a former senior Glanbia executive and ex-DAA CEO, to remain on the board, it's also understood that the group will not compromise on Mr McGann's removal or the appointment of three nominees, including a chairman.
Aryzta's shares have slumped about 97pc in the past five years.
In May, Cobas and Veraison called on Aryzta to hold an extraordinary general meeting (EGM) at which the disgruntled investors will propose the removal of five current members from the board. They are Mr Toland, Mr McGann, Dan Flinter, Rolf Walter and Annette Flynn.
The activists have proposed that Urs Jordi will be appointed chairman. He's the former boss of Swiss baker Hiestand International. It was acquired in 2008 by Irish company IAWS, creating Aryzta.
Mr McGann is also the chairman of listed gambling giant Flutter Entertainment, which owns Paddy Power. He's the former chief executive of packaging group Smurfit Kappa.
Earlier this month, the activist shareholders represented by Veraison accused Aryzta management of "delaying tactics" in not holding the EGM until mid-August - three months after it was requested.
Investment bank Rothschild has been appointed by Aryzta to undertake a strategic review of the business, with the results of that review due in July.
Mr Toland told the Irish Independent last month that he intends to remain at Aryzta, despite the activists' push for change.
"I came for a reason, I'm here for a reason and I'm doing everything to help this company become very, very successful and there is not an iota of change or intent in any of that," he said.
The activists are unhappy with the strategic direction of Aryzta, believing it needs to become a more focused group with fewer product lines and a focus on strategic B2B partnerships rather than a consumer brand business.
Aryzta's clients include food service companies such as McDonald's and Subway. A new strategy backed by activists would also likely include a smaller geographic footprint. Aryzta currently operates across Europe, in North America, Asia and other territories.
Last week, 'Merger Market' reported that a take-private of Aryzta could be a possibility, to allow it to engineer a revival out of the glare of the stock market.