RNS Number : 4414R
23 August 2010
23 August 2010
NOTE FROM KIFIN LIMITED TO ALL SHAREHOLDERS OF MINERVA PLC
("Minerva" or the "Company")
Your Vote Counts at the General Meeting of 8 September 2010
Transparency, Corporate Governance and the long term viability of the Company
are vitally important
Shareholders are the 'owners' of companies and have the right to voice their concerns
As you are well aware, KiFin Limited ("KiFin"), Minerva's largest shareholder, is proposing resolutions for you to vote on, that require the Company to disclose vital financial information on the refinancing of its debt, to remove the Chairman and the CEO and to elect two new directors who will work alongside the board to appoint a new CEO with the requisite property experience to secure the Company's future.
We believe that Minerva's management needs to be changed and unless shareholders initiate this process, the present Board will not.
Against this backdrop, we are heartened that The Financial Reporting Council, the UK corporate governance regulator, last month released its Stewardship Code for institutional investors. This code sets out guidelines which aim to improve the quality of corporate governance at public companies through promoting better dialogue between shareholders and company boards. It encourages greater transparency and for investors to take responsibility for overseeing the companies they own. In calling for this General Meeting we echo exactly those sentiments and aim to achieve exactly what they propose.
Last week, and only with a shareholder vote pending, the Company did release part of the financial information which KiFin had previously requested. However, without the full information we requested, it remains impossible to assess the value and viability of the business.
Your Company's management constantly says that "KiFin wants control without paying a premium". This is not the truth. We would not want control because we would be terrified at the thought of KiFin having to consolidate almost £1 billion of Minerva's debt onto its own balance sheet. Equally, we do not want the responsibility of refinancing Minerva. We will therefore never raise our shareholding beyond 50%. Two out of eight seats on the Board DOES NOT represent control.
KiFin quite simply is unhappy with the way the Company is presently run and requires a chairman and CEO that are open to engagement and dialogue with ALL shareholders.
After five years under the stewardship of Oliver Whitehead and Salmaan Hasan, a chairman and CEO who have control without any meaningful ownership, the Company is in a perilous state. The undeveloped and/or unlet properties at Croydon, Odeon Kensington, St Botolphs, Walbrook and Wandsworth are all fraught with unresolved issues and problems. This is not to mention the Company's inadequate financial reporting and hype about profits, which does not in any way reflect the fact that there is insufficient cash flow, the life-blood that the Company needs in order to survive.
Additionally, one does not need to be a rocket scientist to see how hugely over leveraged Minerva is.
The limited and inadequate detail of the refinancing now available shows that Minerva is in dangerous territory, far more so than when the shares fell to 7p after the executive led Board rejected the Limitless bid of £1.60.
Management has already missed several potential tenants for the Walbrook and, unless a tenant is found soon, the Company will need to raise fresh cash, as the remaining assets, with little equity value in their present condition, are unsaleable at a price that reflects their potential worth.
We want Minerva plc to have a new management team that conforms with corporate governance best practice, provides shareholders with transparency and full disclosure of key financial information and to ensure that it has a clear strategy and is professionally managed.
YOUR VOTE IN SUPPORT OF THE RESOLUTIONS IS A VOTE TO IMPROVE THE MANAGEMENT OF MINERVA, ENGAGEMENT WITH ALL SHAREHOLDERS AND TO ENSURE GOOD CORPORATE GOVERNANCE
WE, THE SHAREHOLDERS, ARE THE OWNERS OF THE COMPANY AND IT IS OUR DUTY TO ENSURE IT IS RUN PROPERLY
For further information:
Financial Dynamics: +44 (0)20 7831 3113
Stephanie Highett/Richard Sunderland
This information is provided by RNS
The company news service from the London Stock Exchange