Activist investor Sherborne Investors (SIGB) is making a second attempt to appoint directors to Electra Private Equity's (ELTA) board. Sherborne, which holds about 30 per cent of Electra's shares, has requisitioned a shareholder meeting to vote on proposals that Edward Bramson, partner in Sherborne and Ian Brindle, a former UK chairman of PriceWaterhouseCoopers, be appointed to the board.
Shareholders rejected Sherborne's attempt to get Mr Bramson and Mr Brindle onto the board at a meeting in October 2014, with nearly two thirds of votes cast against. However, Electra launched a review of its fee arrangements with its manager, capital structure and distribution policy, in response to some of Sherborne's suggestions. Following the review, in February Electra said it would reduce its fees, return 3 per cent of its net asset value (NAV) a year via dividends and share buybacks, and repay its debt.
Sherborne says it is making this latest attempt because Electra's chairman refused Sherborne board representation, and because it believes recent changes to the trust's portfolio and capital structure have led to an increased level of risk. It also believes there is scope to improve corporate governance, and says the trust's latest results illustrate that the operating performance of its investments offers a valuable opportunity for improvement - which Mr Bramson and Mr Brindle could help with. They would not have control, however, as they would sit alongside six other directors.