Activist investor Alexander Anton wants to kick out toy maker Hornby (HRN) chairman Roger Canham and take his place, and his effort is supported by the group's second largest shareholder New Pistoia Income.
New Pistoia has a 20% stake and supports the upheaval as the company has lost £31m over the last five years.
Other investors are unmoved by the news as the stock remains static at 33p.
WHY DOES ANTON WANT CANHAM OUT?
Phoenix Asset Management holds the biggest stake at 34% in Hornby where Mr Canham is also chairman.
Anton believes shareholders have lost ‘enormous value’ under an ineffective strategy and that Phoenix Asset’s dominance is not in accordance with good corporate governance.
According to Anton, the general meeting will discuss getting rid of Canham after several months of meetings with Phoenix ‘ultimately proved fruitless.’
In a statement Anton has blasted Canham, commenting: ‘The last five years under Mr Canham have been disastrous for Hornby’s shareholders.
‘I believe it is time for new leadership, as in my experience, positive change nearly always requires fresh perspective.’
WHY HAS HORNBY STRUGGLED IN THE PAST?
In 2016, the company reported an underlying pre-tax loss of £5.7m in the year to 31 March following four profit warnings over the prior three years.
Over the past few years, Hornby has found it difficult to drive sales as its products such as Scalextric and model railways were seen as outdated or niche.
Anton has a history of enforcing change. In 2012 with the help of former investment banker Geoff Wilding, three directors at carpet business Victoria (VCP) were kicked out.
During the overthrow, Anon, Wilding and Andrew Harrison were appointed directors. Since the change in management, the stock has rallied nearly ten-fold from 48.5p on 3 October 2012 to 455p on 10 April 2017.
