Swiss-Irish food group Aryzta has moved to allay investors that the proposed renewal of its two-year authority to issue share capital would not be used to compensate senior staff.
Ahead of its upcoming annual general meeting next month, which includes a resolution on the issuance of further share capital, the company said the resolution, if passed, would not be used as a vehicle to award shares to senior executives.
“Aryzta now confirms that it has no intention of utilising, and will not utilise, the renewed authority that would be conferred by the passing of Resolution 6 for future share issuances for employee participation or compensation purposes whatsoever,” the company said in a statement, noting the authorised share capital was a prerequisite for the proposed scrip dividend distribution to normal shareholders.
Damaging revelations
The statement is likely to have been issued on foot of inquiries from investors still reeling from a string of damaging revelations about the company and the high-profile exit of long-time chief executive Owen Killian, the group's chief financial officer Patrick McEniff and chief executive of the Americas region John Yamin earlier this year.
The trio, who were awarded handsome stock options during their tenure in charge, left the company in the wake of a series of profit warnings and earnings reports that disappointed the market.
In March last year, Mr Killian was also forced to sell some €16.8 million of shares, or two-thirds of his remaining stake, as the value of the stock, held as collateral against his personal borrowing, plummeted, prompting an outcry from investors.
Insider trading inquiry
The company, which is chaired by Gary McGann, also recently admitted that a newly selected non-executive director who is the subject of an insider trading investigation was now not going to stand for election by shareholders to the board.
The company announced the appointment of Juergen Steinemann in August, as part of Mr McGann's efforts to renew Aryzta's board.
However, it emerged earlier this month that Mr Steinemann is being investigated by prosecutors in Dusseldorf after financial watchdogs became suspicious over a share transaction of his at the retail group Metro last year. He is the chairman of Metro’s supervisory board.
