SHAREHOLDERS at fire enginemaker AssetCo clashed with former owner Pelham Olive over raising cash for the business yesterday.
Three of Assetco’s large shareholders said they were willing to provide it with new funding via a share placement if it appoints a new executive chairman, but its existing chief executive, John Shannon, and Olive opposed the move, saying better options are on the table.
AssetCo needs £3-4m in working capital after raising £16m in a share sale it announced earlier this month. Shareholders North Atlantic Value, Gartmore Investment and Utilico Investments said they can provide up to £3.33m in additional funding each, in exchange for new ordinary shares at a price of 10p per share.
But Olive, who still holds a 1.5 per cent stake, objected to the placement’s large discount to AssetCo’s current 15.5p share price. In a letter to Richard Day at Arden Partners, AssetCo’s nominated adviser, Olive complained of being “kept almost completely in the dark during the whole process of emergency fundraising during the last two or three weeks.”
Olive added he was “mystified” why shareholders had not progressed a bid by investment group Arcapita, which is in advanced talks to buy AssetCo. Day did not respond to a request for comment.