Foster’s AGM brawl
Foster’s shareholders were not amused. Actually, they were quite irate at Foster’s – probably – last Annual General Meeting held in Sydney on 25 October 2011, as 42 percent of shareholders rejected an AUD 5.2 million (USD 5.5 million) pay and perks package for Chief Executive John Pollaers.
Just over 56 per cent of shareholders voted to award a short and long-term incentive of about AUD 5.2 million (EUR 3.9 million) worth in shares to Mr Pollaers. He has headed Foster’s for less than seven months and is widely tipped to leave when SABMiller takes control of Foster’s later this year.
What infuriated shareholders was the fact that the long-term bonuses, payable in 2014 and 2015, were given to Mr Pollaers after SABMiller went hostile in its battle for the Australian brewer. At that time, everybody on Foster’s board must have been fully aware that Mr Pollaers would never have to work for his long-term bonus.
Fosters’ Chairman David Crawford feebly justified the bonus package by saying that, at that time when the bonus was agreed, the imperative for the board was to ensure it gave executives incentives big enough for them to stay on during the takeover process.
“We were pretty short on executive talent,” Mr Crawford was quoted as saying. He also credited Mr Pollaers with gaining the improved AUD 5.40 per share offer after Foster’s had rejected SABMiller’s initial AUD 4.90 bid.
At the heated meeting Foster’s shareholders also directed their anger against the board over the company’s plan to accept an AUD 12.3 billion takeover from SABMiller.
According to media reports, several shareholders told directors they were disgusted with the proposed sale but felt powerless to stop it from going ahead.
Foster’s executives were forced to defend the takeover before around 200 shareholders, saying the deal offered the certainty of cash in a volatile global environment.
Foster’s shareholders will vote on 2 December 2011 over a recommendation to accept SABMiller’s takeover offer. The takeover, which requires approval of 75 percent of votes, however, has wide support from institutional investors.
