Invesco secures Omega board vote

Chris Wheal

Feb 1st 2010

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Filed under: Investing, Markets, Insurance

Invesco Perpetual fund manager Neil Woodford appears to have won his shareholder revolt with Bermuda-based Lloyd's of London insurer Omega. The firm has caved in and is calling a special general meeting (SGM) to vote on proposed board changes.

Woodford's preferred list of candidates will now face a ballot and several of the current board will quit if Woodford's team win. It has been like a City soap opera.

Those to be voted on include John Coldman as chairman, James Bryce, Robin Spencer-Arscott, Jonathan Betts, Ernest Morrison and David Cooper.

Resignations

Omega said current chairman Walter Fiederowicz, Christopher Clarke and the three other non-executive directors will resign if the resolutions are passed.

The company had been trying to negotiate an agreed way forward and many commentators have been surprised they have fought for so long against the voting.

I am looking forward to the "I told you so" moment in six months to a year. Whatever the outcome of the SGM, those in charge afterwards will be under intense pressure to pull Omega's socks up. And all eyes will be watching.

Shareholder power

Shareholders have, in the past, been criticised for not being proactive enough. But in this case there has been an element of criticism that the shareholders led by Invesco Perpetual are trying to micro-manage the company.

Imagine if Woodford's team win the SGM vote and appoint their management team but that team fails to turn Omega into the powerhouse they believe it should be.

It's not just the managers' reputations on the line but Woodford's. If successful, expect many more direct shareholder interventions. If unsuccessful, Woodford's "Golden Boy" status will be in doubt.