Pointing out the Austock conflict at ABC Learning
January 14, 2008
This article by Liam Walsh appeared in The Daily Telegraph after the ABC Learning EGM on June 7, 2006.
Childcare giant ABC Learning Centres yesterday lifted executive pay rises and shored up millions in funds from recent share issues at a tense meeting.
The Brisbane extraordinary meeting passed resolutions for new shares to ABC staff and professional investors, and to almost triple the pay packets of three of ABC's executives.
All the resolutions, passed with a small protest vote. But the board was forced to defend accusations of a potential conflict of interest. The issue was that ABC, which has more than 1200 centres globally, used stockbroker Austock to handle fund-raising. Austock is chaired by ABC director Bill Bessemer and ABC founder Eddy Groves owns a stake.
Shareholder activist Stephen Mayne said: "As a small shareholder, that concerns me.''
But ABC chairwoman Sallyanne Atkinson argued it was only a "potential conflict of interest''.
"They [Mr Groves and Mr Bessemer] are not party to any discussions on Austock,'' she said.
Ms Atkinson said Austock had a proven record for successfully raising funds for ABC.
Director Martin Kemp declined to discuss specifics. "We are looking at a number of opportunities,'' he said.
The meeting approved executive pay packets under which Mr Groves, wife Le Neve Groves and Mr Kemp will earn a fixed yearly salary of $500,000.
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