Vodafone 'facing revolt to oust chief exec'

Vodafone is facing a revolt from a group of institutional shareholders who want to see the mobile phone giant’s chief executive ousted from the board, it was reported today.

The investors, who are said to be unhappy with the group’s recent performance, plan to vote against the election of chief executive Arun Sarin and up to four other directors at Vodafone’s annual general meeting next month.

The institutional investors are planning to lobby other big shareholders over the next few weeks to persuade them to join the revolt, according to The Sunday Times.

Mr Sarin has held the top job for three years and is under increasing pressure because of the lacklustre performance of the company’s share price.

The other non-executive directors who are said to be facing the vote of no confidence are Michael Boskin, Jurgen Schrempp and former chairman of Marks & Spencer Luc Vandevelde.

Investors are also understood to be planning to vote against or abstain from re-electing John Buchanan, who was recently named as the company’s next senior independent director.

It is thought the shareholders are worried Mr Buchanan may be too busy to focus on Vodafone, as he is also chairman of pharmaceutical group Smith & Nephew and sits on the board of exploration group BHP Billiton and drugs giant AstraZeneca.

The report comes just days after Vodafone announced record losses of £14.85bn (€21.6bn), an all-time high for a UK company, as a result of having to write off £23.5bn (€34.2bn) from the book value of its assets, in particular its German acquisition Mannesmann.

But the group sought to draw a line under the legacy of its acquisition spree, with Mr Sarin setting out plans to drive growth from existing assets, in particular the broadband and landline markets.

Mr Sarin warned the company needed to cut costs if it was to counter slowing revenue growth in its core markets and prepare itself for a push into lower-margin activities, and he announced plans to slash 400 jobs at its Newbury headquarters.

The market responded positively to the plans despite the record loss, with Vodafone’s shares ending the week 6% higher at 126.75p.