Cuisine de France owner Aryzta has blasted calls by influential shareholder advisory firm Glass Lewis for the baked goods giant's investors to back rebels seeking to install their own chairman at the group.
In a letter to shareholders, Aryzta chairman Gary McGann said the embattled company "respectfully disagrees" with recommendations from Glass Lewis ahead of a crunch extraordinary general meeting by Aryzta next week.
"There is no 'silver bullet' that any strategic initiative or additional board refreshment process can deliver," it warned. "Aryzta needs a proven, coherent board with an executive team singularly focused on accelerating the turnaround strategy. We believe the proposals we have put forward represent the best interests of all stakeholders."
Activist investors - Switzerland's Veraison and Spain's Cobas - that between them own more than 20pc of Aryzta have mounted a months-long campaign to revamp the Aryzta board. The activists insist that the baked goods group, whose customers include McDonald's, Subway, Walmart and Lidl, must offload at least €600m worth of assets to cut debt. Its business has been hit hard by the Covid pandemic.
Aryzta wants to install Andreas Schmid as the group's new chairman next week, succeeding Gary McGann.
But the rebels are vying to have their own candidate, Urs Jordi, elected to the post. Mr Jordi is former boss of Hiestand International, the company that was originally acquired by Irish group IAWS to create Aryzta.
Glass Lewis said last month that given what it described as the urgency and magnitude of issues facing Aryzta, it would be appropriate to back Urs Jordi as chairman. The advisory firm added that while Mr Schmid is an experienced executive, he does not have the same level of experience in the bakery industry as Mr Jordi.
Aryzta, whose chief executive is Kevin Toland, said a report from Glass Lewis contains "emotive language" similar to that used by rebel shareholders. The baked goods firm added that a claim by Glass Lewis that the Aryzta board has "engaged in tactics to delay the EGM and launched a chaotic strategy process followed by a last-minute attempt to sell the company" has "no basis in fact" and is "inconsistent with the information provided in our engagement with Glass Lewis".
"The effect of the shareholder group's proposals is to introduce significant risk to the business, risk that Aryzta believes would present significant, additional operational and financial stress," said the company.
It added that it could not recommend the activist shareholders' board nominees to investors "without a rigorous and thoroughly engaged process".
"It would be a failure of our duties as a board and of our obligations to all stakeholders," it said.
"Glass Lewis' recommendations effectively support significant board changes with consequent average board tenure of just over one year," Aryzta insisted. "Again, we believe that this presents significant risk for the effective functioning of the business and runs counter to the more balanced, compromise proposals we have put forward."
Aryzta said it entirely rejects any suggestion that Mr Schmid would have insufficient time to devote to Aryzta. He is a member of a number of boards.