Coast Capital and First Group in showdown ahead of meeting
Activist investor Coast Capital has accused the board of First Group of failing to inform all shareholders of its plans ahead of a meeting this afternoon.
The New York hedge fund said First, the train and bus operator, had told some shareholders that “everything is for sale at the right price”, going against itspublic strategy.
Read more: Schroders and Columbia Threadneedle back Coast Capital in First Group dispute
In a letter to shareholders Coast Capital also accused First of exploring the sale of its First Student division with private equity investors, including discussing indicative pricing.
“Such news, if true, would run counter to the company’s publicly stated strategy and would appear to be material non-public information in nature,” the letter said.
“It would also amount to highly selective distribution of information among shareholders.”
First has denied the accusations, branding the allegations “desperate and spurious”.
A spokesperson for First said: “We have confirmed that these claims are baseless in fact and law, and told that to Coast.
“We have asked them to provide evidence to substantiate their claims and they have not been able to provide any such evidence.
“Conflicting accounts of the company’s strategy are not circulating amongst shareholders.
The exchange comes ahead of an extraordinary general meeting at which Coast will oppose the re-election of the company’s chairman Wolfhart Hauser.
Read more: Coast Capital hits out at First Group over defamatory attacks
Coast, which owns a near 10 per cent stake in First, has been agitating for a radical restructuring of the company.
Coast’s demands including splitting First’s UK assets from its US assets, withdrawing from Britain’s railways and overhauling its board.
Yesterday Schroders and Columbia Threadneedle said they would support Coast in this afternoon’s vote.