Books stay shut as M&S defies tycoon

Marks & Spencer today showed no sign of giving in to investor pressure to open its books up to retail tycoon Philip Green.

The group defied calls from its largest shareholder to allow Mr Green to complete due diligence ahead of a potential £9.1bn (€13,6bn) bid.

United States-based Brandes, which has an 11.7% stake in M&S, issued a statement urging the retailer to consider his final proposal of 400p (€6) a share.

It has already pledged to back a formal offer from bid vehicle Revival Acquisitions, while Mr Green wants other shareholders to put pressure on M&S.

But addressing investors at the start of the company’s annual meeting in London, M&S chairman Paul Myners said the stance of the board was unlikely to change.

He pointed out that the tycoon could have made an approach direct to shareholders through Revival.

“Some people have asked whether we are depriving shareholders of choice,” Mr Myners said.

“If a bidder disagrees with a board’s view on value, the usual way for a bidder to offer shareholders a choice is for the bidder to make a formal offer to shareholders directly.

“This route was open to Revival and it has chosen not to take it.”

Mr Myners vowed to help M&S to restore growth in sales and profits, and backed the vision of chief executive Stuart Rose outlined on Monday.

This blueprint included a £2.3bn (€3.4bn) windfall for shareholders and the sale of financial services arm M&S Money for £762m (€1.1bn).

Richard Ratner, of Seymour Pierce, said the intervention of Brandes could force the board to change its mind about opening up its books.

“For anything to happen, more shareholders must put their heads above the parapet,” he said.

But it appeared the stance of the M&S board has won the support of private investors who own 20% of shares in the high street giant.

Many shareholders attending the company meeting said Mr Rose should be given time to turn around the struggling retailer.

A chorus of boos met investor Leonard Bash who compared the performance at Bhs, which is owned by Mr Green, over the past year with faltering sales at M&S.

Another investor, Martin Edwards-Simmons, said the company should thank Mr Green for spurring management to focus on the business, but a formal bid would be an “appalling distraction”.

Overseas investors such as Brandes and Artisan Partners were criticised for apparently missing today’s meeting.

“It’s disgraceful that they are not here … we don’t want absent shareholders deciding the future of this company,” Mr Edwards-Simmons said.

Private shareholder Barry Hyman said investment houses would be more interested in banking profits than acting in the best interests of the company.

He added: “I prefer an M&S that is looking through Rose-tinted spectacles than one that is going Green around the gills.”

Some investors also expressed anger at the need for a new management team to drive another sales recovery.

One shareholder said: “Does anybody think that our shares would have increased over the past three months or this £2.3bn (€3.4bn) would have been found if there wasn’t a takeover approach? Of course it wouldn’t.”

Criticism was also levelled against the pay-offs to ousted chief executive Roger Holmes and chairman Luc Vandevelde, which were seen by many shareholders as “rewards for failure”.