The Ontario Teacher’s Pension Plan has put Vodafone chairman John Bond and his deputy John Buchanan on report ahead of the company’s AGM next Tuesday.
The activist pension fund with C$100bn (US$96bn) assets under management has said it will be voting…
The Ontario Teacher’s Pension Plan has put Vodafone chairman John Bond and his deputy John Buchanan on report ahead of the company’s AGM next Tuesday.
The activist pension fund with C$100bn (US$96bn) assets under management has said it will be voting against the re-election of Bond and Buchanan, hoping that removing the top tier of Vodafone’s c-suite would be: “a critical step to catalyse a corporate restructuring and a re-examination of Vodafone’s history of poor capital allocation and disastrous M&A.”
The OTPP is most critical of Vodafone’s foreign dalliances, notably the minority businesses it owns in the USA, France and China.
When TelecomFinance contacted Vodafone a spokesman said: “There is not much we can say. It’s not our policy to comment on individual shareholders or their voting intentions. However, we always maintain an active and open dialogue with all of our investors.”
One of the ways that the OTPP sees a re-focus of Vodafone is through the disposal of minority stakes in assets, such as the 45% it owns in Verizon Wireless, or the 44% stake holds in France’s SFR.
However, this call to action might not be in the best interests of all shareholders, as a disposal of Vodafone’s assets in a fire sale would not realise the best returns for the companies, as the stakes would probably be passed on at below market value. Pushing a sale on unwilling partners might not make the best corporate sense.
The OTPP is a very small investor in Vodafone, owning only 0.4% and supports the re-election of Vodafone’s CEO, Vittorio Colao. It would require a major shareholder revolution to turn the OTPP’s disquiet into a worrying revolt against Bond and Buchanan. However, it does raise the spectre of discontent on the eve of the reporting of Vodafone’s Q1 10 results tomorrow.
