Activist investor Saba failed in its attempt to overhaul the board of Workspace Group at the company’s annual general meeting (AGM) yesterday.
In early May, the US hedge fund issued a requisition notice requesting the removal of five of the company’s six non-executive directors – all other than Manju Malhotra – to be replaced by Nick Shattock, Andrew Sim, Richard Starr and Gregory Attwood.
In a revised requisition notice later that month, Saba which owns a circa 21.12% stake in the business, proposed the removal of all six of the company’s non-executive directors, including Malhotra, and the appointment of six new directors in their place. At yesterday’s AGM, none of the resolutions requisitioned by Saba were passed.
Duncan Owen, chair of Workspace Group, said: “Today the majority of our shareholders have voted decisively to back the board and our existing strategy to deliver sustainable value for all shareholders. We are grateful for their support and are fully focused on the delivery of our strategy under Charlie and Tom’s leadership. We remain committed to open and constructive dialogue with all of our shareholders.
“The board regularly reassesses the need for refreshment to ensure an appropriate balance of skills, experience, independence and diversity, and believes that this is best achieved through an orderly, structured and independent process that considers Workspace’s long-term strategic needs and the interests of all of our shareholders. We look forward to engaging further with shareholders following the outcome of today’s AGM as part of that process.”
A spokesperson for Saba said: “Today’s result does not change the facts. Over the last five years, shareholders have lost 48%, while Workspace now trades at the widest discount to NAV in the UK REIT sector. These are not the hallmarks of effective stewardship. They are the consequence of years of poor strategic judgement, weak oversight and flawed capital allocation.
“This outcome does not detract from the assessments of ISS and Glass Lewis, the world’s two leading proxy advisory firms. While recommending different Saba nominees, both concluded that Workspace would benefit from board change and additional real estate expertise at this critical juncture. Despite the company’s performance record, the board continues to advocate a reinvestment strategy that it claims will generate returns approximately eight times higher than it has ever delivered.
“We remain convinced that Workspace has a significant opportunity to create shareholder value through a more disciplined approach to capital allocation, prioritising selective asset sales, share buybacks and operational efficiency over higher-risk, lower-return reinvestment opportunities. Saba is Workspace’s largest shareholder and will continue to closely monitor the performance of the company and board.”
