Directors of troubled infant milk formula group Bellamy's Australia are ramping up their campaign against dissident shareholders after unmasking one of the company's original backers, Jan Cameron, as standing behind a key block of shares in the company.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
A foundation run by Ms Cameron, who is best known as a co-founder of the Kathmandu retailing chain, is a beneficiary of a 14.5 per cent block of shares in Bellamy's registered in the name of the Black Prince Private Foundation, which is registered in Curacao, in the Dutch Caribbean.
Ms Cameron has persistently argued she has no connection with the Black Prince Private Foundation, although she did tell BusinessDay earlier this week she had gifted the shares to the foundation when Bellamy's was issuing shares to list on the sharemarket. As well, all dividends and any profit from the sale of this foundation's shares flows to the Elsie Cameron Foundation of which Ms Cameron is a director.
A notice issued by Bellamy's to the Black Prince Private Foundation clarified that it traces its holding via companies stretching from Singapore and Malaysia to the Dutch Caribbean, with the Bellamy's shares acquired in mid-2014. Bellamy's shares were listed on the Australian sharemarket in August 2014.
"It is pretty disappointing to have to go to these lengths to find all this out," Bellamy's chairman Rob Woolley said.
"It says a lot about Jan ... It says a lot about the people involved – they've not been forthright with shareholders."
Claiming to hold sway over a block of 35 per cent of Bellamy's capital, Ms Cameron is seeking to replace the four independent directors of Bellamy's with her own slate of nominees which would give board control to the directors she is backing. Ms Cameron has also stated she wishes to remove Bellamy's chairman, Mr Woolley.
With 14.5 per cent held via the Black Prince Private Foundation and another 2 per cent in her own name, this effectively means Ms Cameron, a 16 per cent shareholder, is seeking board control, Mr Woolley said.
"I've worked to ensure control is not given up easily," Mr Woolley said. "This doesn't add up."
The Australian Securities and Investments Commission is believed to be monitoring developments, but it is yet to show its hand publicly. Officials would not comment when contacted on Wednesday.
"If you are in agreement to control the board, it is puzzling that substantial shareholder notices have not been lodged," one corporate governance expert said.
"At the very least ASIC should have queried the state of any agreement between the dissident shareholders to clarify whether they are acting in concert.
"The public comments by Ms Cameron claiming she has no connection with Black Prince Private Foundation and who controls it do not appear to be grounded in reality."
Bellamy's last week removed its chief executive, Laura McBain, at the same time as it issued a trading update which confirmed a slowing in sales into the key China market as it warned it may need to make "shortfall" payments to suppliers as inventories rose. Importantly, that update also disclosed that a key supplier, Fonterra, can walk away from its supply contracts with the company if a single shareholder group controls more than 30 per cent of the company's capital.
Shares in Bellamy's fell 9¢ to $4.03 against the backdrop of a weaker sharemarket on Wednesday, with the shares touching an intra-day low of $4.
The story Bellamy's to ramp up campaign against dissidents first appeared on The Age.
