Shareholders in Hammerson have lined up to defend the company after its largest investor called for a change in board composition at the company’s upcoming annual general meeting.
Schroders and Legal & General Investment Management followed APG Asset Management, Moerus Capital Management and Stanlib in pushing back against criticisms from Lighthouse Properties, which holds close to a quarter of Hammerson.
In Lighthouse’s annual report, the company said it is “not satisfied “ with Hammerson’s efforts at cost-cutting and expressed disappointment at the lack of a dividend, adding: “It appears that shareholders will have to bring pressure to bear on Hammerson’s board and management to turn around this value destruction for shareholders.” The company is understood to be seeking votes against two non-execs at the AGM next month.
A Hammerson spokesperson described the proposals as “unnecessary, distracting and value-destructive”, adding: “Hammerson’s chair and board are of the highest quality and changing the composition would risk destabilising the focus and great work that is being delivered by the company.”
A spokesman for Schroders, which has a circa 4% stake in Hammerson, said: “As a long-term active investor in Hammerson, our aim is to use our influence to engage constructively and thoughtfully with the companies in which we invest.
“We support the board’s strategy of divestment and deleveraging, and believe the current board is well-positioned in regards to skills, experience and diversity. As such, we will not be supporting the shareholder resolutions proposed by Lighthouse Properties at the upcoming annual meeting.”
Legal & General Investment Management, which holds a 2.2% stake, added: “We remain supportive of Hammerson’s board and the management team, and we agree with the decision to retain cash to further strengthen the balance sheet rather than paying a final dividend for 2022.
“Our view is that the resolutions proposed would act to destabilise the board and disrupt the organisation. Long-term shareholder value creation should continue to be the priority for Hammerson, and at this point we believe the board composition as it stands is optimal to deliver this.”
A spokesman for APG Asset Management, Hammerson’s second-largest investor, said: “While recognising some of the strategic challenges Hammerson is working to address, APG AM remains confident in the company’s current leadership team which has been making demonstrable progress on the execution of the strategy aimed at delivering long-term sustainable value in a challenging backdrop.
“APG AM believes it is in the best interest of the company and its stakeholders to allow the current board of directors to continue to perform effectively and demonstrate commitment to their role. Therefore, at the Hammerson AGM… APG AM will vote for all the incumbent directors up for re-election, and will not support the resolutions 18 and 19 that have been requisitioned by Lighthouse.”
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