Dignity PLC’s (LON:DTY) largest single shareholder, Phoenix UK Fund, outlined its reasons for wanting to remove Clive Whiley as executive chairman of the funeral company as the boardroom dispute intensified.
“We believe we can no longer trust Clive Whiley to be executive chairman of Dignity,” Phoenix said in an open letter to shareholders.
“As part of our work assisting the company this year, we uncovered what we believe are some very serious issues in the prepaid funeral plan business. We gathered the relevant information and sent it to Clive ahead of the budgeting process and finalisation of the annual results. In our view, his subsequent actions in dealing with the matter, internally and externally, left us no choice but to seek his removal as a director,” it said.
Phoenix declined to go into details, citing its confidentiality agreement with Dignity.
Yesterday, Dignity called a general meeting for April 21 and said its independent directors recommended that shareholders vote against Phoenix’s challenge and that they would all resign if Phoenix was successful in appointing founder and chief investment officer Gary Channon as Dignity’s new chairman.
Dignity has questioned the timing of the move, saying that it had made considerable progress towards the completion of the previously announced strategic review and that the management change would be disruptive.
Dignity’s independent directors were also very critical of Channon.
“The independent directors also unanimously agree that, by virtue of his behaviour throughout the course of the board’s dealings with him, Gary Channon has demonstrated himself as lacking the skills and judgement required of someone seeking to be responsible for leading the executive function of a public company of Dignity’s stature,” they said in a statement yesterday.
Phoenix reitereated today that it is proposing no pay and no expenses for Channon and sought to reassure shareholders about the company’s future.
“We are also giving you the peace of mind that we won’t use this situation to make a bid for the company,” it said.