2 May 2014

Support for removing Abano chair

7:37 am on 2 May 2014

One of Abano Healthcare's major institutional shareholders says it doesn't support former director Peter Hutson but that it will still vote with Mr Hutson to remove the chairman, Trevor Janes.

SuperLife owns about 4 percent of Abano and voted with Mr Hutson and another disaffected shareholder, James Reeves, against Mr Janes re-election at last November's annual shareholders' meeting.

Peter Hutson and James Reeves own nearly 19 percent of Abano. Just over half of Abano's shareholders voted at last year's meeting so their votes and SuperLife's vote against Mr Janes amounted to nearly 44 percent of those voting.

SuperLife director Michael Chamberlain said he thought Mr Hutson had other motives for campaigning against Abano's strategy and seeking Mr Janes' removal.

Mr Chamberlain believed Abano's board had mishandled the issue of Mr Hutson and the attempted take-over last year by Australian private equity firm, Archer Capital, which Mr Hutson supported.

Archer had agreed, if its take-over was successful, to sell Abano's half share of the audiology joint-venture to Mr Hutson for a nominal sum.

Archer didn't make a formal offer but had sought the support of Abano's board for a scheme of arrangement, a form of take-over which requires the approval of only 75 percent of shareholders, rather than the more normal take-over method which requires 90 percent acceptance.

Abano's board refused to support the bid, which it said greatly undervalued the company and refused to allow Archer to do due diligence because it said Archer was a potential competitor to its dental business.

Mr Chamberlain said there was no evidence of this and that the board should have allowed Archer to do due diligence.

Mr Chamberlain said he was concerned Abano kept issuing statements saying the board is unanimous. He said that indicated poor governance.

The one director Mr Chamberlain does support is the long-serving managing director, Alan Clarke, who he described as being a very good chief executive.