FirstGroup survives boardroom coup as chairman resigns

Aberdeen-headquartered train and bus operator FirstGroup has defeated attempts by activist investor Coast Capital to oust six board members, including the chief executive and chairman.

FirstGroup has seen off an attempt by Coast Capital to oust half a dozen board members. Picture: Contributed

However, following the shareholder vote, chairman Wolfhart Hauser said he would step down from the FTSE 250 transport group at the next annual shareholder meeting in July.He said: “Having renewed the board through the appointment of independent directors with a diverse range of skills and expertise, focused on the future of mobility services, and overseen the appointment of Matthew Gregory as chief executive and Ryan Mangold as chief financial officer to drive delivery of the strategy, it is now time for me to move on.”David Robbie, senior independent director, will step into the role on an interim basis and oversee the selection process for the next chairman.At a special closed-door meeting in central London yesterday shareholders voted against US investor Coast’s plans to install six of their own handpicked replacements. None of the proposed replacements were elected either, with the 13 resolutions voted down. Former UK transport minister Steven Norris earnt 36.4 per cent of votes, the highest share of support of all nominees put forward by Coast.Votes against the current board members varied from 25 per cent for a trio including chief executive Matthew Gregory, to 45.6 per cent against James Winestock. Hauser saw 29.3 per cent of the votes go against him.FirstGroup, which runs Great Western Railway, South Western Railway and the TransPennine Express, opposed the plans, but as Coast holds a 9.7 per cent stake, the group was forced to put the proposals to a vote.The meeting lasted nearly 80 minutes and was not attended by any of the nominees put forward by Coast.After the meeting, private shareholder Anthony Lee said: “I think [Coast] had a fair point about the lack of experience on the board of train and bus operators. But what I don’t agree with is the idea to leverage the company [by loading it with debts]. “What may be good from this is the shock it gave the company and just what it needed.”Henry Langley, another private shareholder, said: “I was disappointed not to have the opportunity to hear from Coast. I also don’t feel the chairman gave very satisfactory answers to the questions posed.”Earlier this year, FirstGroup said it would put its US Greyhound bus business up for sale and look at potentially selling its UK bus division too.Coast has previously said it wants the group to split its US and UK businesses and remove itself from Britain’s rail industry, while the US firm’s chief investment officer James Rasteh has publicly stated that FirstGroup management “don’t know how to manage the business”.

Sign up to our daily newsletter

The i newsletter cut through the noise