Seven stake likely to save Stokes from investors' wrath
UNHAPPY investors in the Kerry Stokes-controlled Seven West Media are being offered a range of targets at the annual meeting this month, with a proxy adviser and a shareholder advocate recommending a vote against the remuneration report and against several directors, including Mr Stokes.
UNHAPPY investors in the Kerry Stokes-controlled Seven West Media are being offered a range of targets at the annual meeting this month, with a proxy adviser and a shareholder advocate recommending a vote against the remuneration report and against several directors, including Mr Stokes.The Australian Shareholders Association opposes the re-election of Mr Stokes' son, Ryan Stokes, on the grounds the company has too many non-independent directors.It also opposes the re-election of Doug Flynn, based on his support of the related-party transaction last year that saw the West Australian Newspapers group acquire Seven's media assets.The ASA said the acquisition would not have been supportable if the merger was justified on more than a single year's results of the Seven media business.In May last year Seven West said it would miss earnings guidance, just a month after the deal was consummated.Shares were then trading above $4 but have since fallen below $1.20.The ASA recommends a vote against the remuneration report and has taken issue with discretionary payments totalling $250,000 made to executives Chris Wharton and Peter Bryant, saying "such discretionary payments do not reflect alignment with the consequences of the merger to shareholders".Proxy adviser ISS recommends a vote against the election of Kerry Stokes and joined the ASA in its opposition to the remuneration report. ISS' concerns with Mr Stokes also centre on Seven West's underrepresentation of independent directors.Its vote against the remuneration report is based on the fact that the pay of new chief executive Don Voelte does not include any component that is at risk."By receiving his maximum entitlement just for showing up, the CEO has no pay alignment with company performance and, ultimately, shareholders," the ISS report said.Mr Stokes is unlikely to be troubled by the recommendations as he controls a 31 per cent stake via Seven Group Holdings, in which he is the dominant shareholder.