Stock Spirits Group’s board of directors has said the company will not change its strategic direction, despite facing the beginnings of a shareholder rebellion last week.
The major shareholder of the London-listed vodka producer, Portuguese retail tycoon Luis Amaral, wrote to investors last Tuesday telling them to oust chief executive Chris Heath at the company’s annual meeting on 17 May and to hire an executive search firm to find a replacement. Amaral also nominated two non-executive directors to help turn around its Polish business.
Stock Spirits, which is the largest supplier of spirits in Poland and the Czech Republic, saw its revenues in Poland slide 10.3 per cent and pre-tax profits slump 35.9 per cent in 2015 amid stiff competition in the drinks market. As part of its turnaround strategy, the company is planning to increase its acquisitions in the European drinks market, which raised the ire of Amaral.
Two further shareholders told the Sunday Telegraph they harboured similar concerns to Amaral, who owns a 9.7 per cent stake in Stock Spirits through his company Western Gate Private Investments.
“I agree with Mr Amaral that you can’t fix Poland and do M&A,” one shareholder told the Sunday Telegraph, while another questioned whether buying business elsewhere would save the country’s ailing business in Poland.
“The board’s number one priority is returning the Polish business to sustainable growth and they believe they have already taken some decisive actions that will help achieve this,” Stock Spirits said in a statement.
“Management will remain on the lookout for acquisitions that would help drive profitability but the would have to be the right assets at the right price that would be of clear benefit to investors. Furthermore, the board would not be able to proceed with any material M&A without the formal consent of shareholders.”