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Millennium & Copthorne Hotels directors hit by revolt by minority shareholders

[LONDON] Millennium & Copthorne Hotels faced an investor revolt over the re-election of some board directors on Friday, following a shareholder rebellion against a takeover bid earlier this year.

The FTSE 250-listed hotelier, majority-owned by Singaporean billionaire Kwek Leng Beng, said minority investors had cast a "significant number of votes" against the reappointment of its independent non-executive directors at its annual meeting.

It comes after Mr Kwek's failure in January to acquire the 34.8 per cent of M&C he does not already own. A group of minority shareholders spurned the 620 pence-a-share offer his vehicle, City Developments Limited (CDL), had made to buy their stock.

The investors rejected the bid, which valued M&C as a whole at £2 billion (S$3.62 billion), despite M&C's independent board directors recommending that shareholders accept the offer.

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Mr Kwek is chairman of M&C and CDL, which also has other directors on M&C's board. As a result of the overlap, M&C board members not affiliated to CDL formed a separate, independent committee to consider CDL's bid.

The independent directors include Shaukat Aziz, who is a former prime minister of Pakistan, and Susan Farr.

Three of M&C's minority shareholders - International Value Advisers, MSD Partners and Classic Fund Management - wrote a letter in December to the directors criticising their backing for the bid and called for new independent board members at M&C.

On Friday, 33.7 per cent of the minority shareholders voted against the re-election of Mr Aziz and 32.5 per cent opposing the reappointment of Farr.

"The board takes the views of the company's shareholders seriously and will continue to engage with them to understand their concerns," M&C said.

A spokesman for M&C said the votes against the independent directors represented an "extension of the divisions" that had opened up during shareholder opposition to the CDL bid.

Earlier on Friday, M&C posted a 3.1 per cent slide in revenue per room during the first quarter, which sent its shares down 2.5 per cent to close at 547 pence.