Pre-Annual General Meeting Information • Aug 12, 2016
Pre-Annual General Meeting Information
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the Resolutions
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the Resolutions, the contents of this document, or as to the action you should take, you are recommended to seek your own independent financial advice immediately from your stockbroker, bank, solicitor, accountant, fund manager or other appropriate independent financial adviser authorised under the Financial Services and Markets Act 2000 if you are resident in the United Kingdom or, if not, from another appropriately authorised independent professional adviser in the relevant jurisdiction.
If you sell, have sold or otherwise transferred all of your Shares you should send this document, together with the accompanying Form of Proxy, as soon as possible to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected for delivery to the purchaser or the transferee. However, the distribution of this document and/or the Form of Proxy into certain jurisdictions other than the United Kingdom may be restricted by law. Therefore, persons into whose possession this document and any accompanying documents come should inform themselves about, and observe, any such restrictions. If you have sold or transferred only part of your holding of Shares you should retain these documents and consult the stockbroker, bank or other agent through whom the sale or transfer was effected.
(Incorporated and registered in England and Wales under the Companies Act 2006 with registered number 927680)
Notice of General Meeting in relation to resolutions proposed by Morgan Stanley Client Securities Nominees Limited (as nominee of and on the instructions of Toscafund Asset Management LLP) to remove Jan Åstrand as a director of Speedy Hire Plc and to appoint David Shearer in his place
Your attention is drawn to the letter from the Independent Board of Speedy Hire Plc (the 'Company') on page 3 of this document which contains the unanimous recommendation of the Independent Board that you vote against the Resolutions proposed by Morgan Stanley Client Securities Nominees Limited (as nominee of and on the instructions of Toscafund Asset Management LLP) at the General Meeting and the reasons for such recommendation. It is expressly noted that Morgan Stanley Client Securities Nominees Limited is acting solely as nominee for Toscafund Asset Management LLP and not on behalf of any Morgan Stanley entity.
Notice of the General Meeting to be held at 11.00 a.m. on 9 September 2016 at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ is set out at the end of this document. A Form of Proxy for use in connection with the General Meeting is enclosed with this document. Whether or not you intend to be present at the General Meeting, you are requested to complete and sign the Form of Proxy in accordance with the instructions printed on it so as to be received by the Company's registrars, Equiniti Limited, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, as soon as possible, and in any event, no later than 11.00 a.m. on 7 September 2016 (or, in the case of an adjournment, not later than 48 hours (excluding non-working days) before the time fixed for the holding of the adjourned meeting). If you hold Shares in CREST and you wish to appoint a proxy or proxies for the General Meeting or any adjournment(s) thereof by using the CREST electronic proxy appointment service, you may do so by using the CREST proxy voting service in accordance with the procedures set out in the CREST manual. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider, should refer to that CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf. Proxies submitted via CREST (under CREST ID RA19) must be sent as soon as possible and, in any event, so as to be received by the Company's registrars, Equiniti Limited, by no later than 11.00 a.m. on 7 September 2016 (or, in the case of an adjournment, not later than 48 hours (excluding non-working days) before the time fixed for the holding of the adjourned meeting).
If you have any questions relating to this document, the General Meeting and/or the completion and return of the Form of Proxy, please telephone Equiniti Limited on 0371 384 2769. If you are outside the United Kingdom, please call +44 (0)121 415 7047. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 8.30 a.m. and 5.30 p.m., Monday to Friday (excluding public holidays in England and Wales). Please note that Equiniti Limited cannot provide any financial, legal or tax advice and calls may be recorded and monitored for security and training purposes.
The completion and return of a Form of Proxy (or the electronic appointment of a proxy) will not preclude you from attending and voting in person at the General Meeting or any adjournment thereof, if you wish to do so and are so entitled.
| Page | |
|---|---|
| Expected timetable of events | 2 |
| Letter from the Independent Board | 3 |
| Guidance on completing the Form of Proxy | 9 |
| Appendix 1 – Toscafund's statement | 10 |
| Appendix 2 – Schedule of meetings with Toscafund, Schroders, David Shearer and Speedy | 14 |
| Appendix 3 – Schedule of meetings with HSS, Exponent and Speedy | 16 |
| Definitions | 17 |
| Notice of General Meeting | 19 |
Latest time and date for receipt of Form of Proxy from Shareholders 11.00 a.m. on 7 September 2016
Voting Record Time for the General Meeting 6.30 p.m. on 7 September 2016
Time, date and location of the General Meeting 11.00 a.m. on 9 September 2016
at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ
All references to time in this document (including the Notice of the General Meeting) and the accompanying Form of Proxy are to London time.
(Incorporated and registered in England and Wales under the Companies Act 2006 with registered number 927680)
Registered Office: Chase House 16 The Parks Newton-le-Willows Merseyside WA12 0JQ
Independent Board Directors: Robert Contreras (Senior Independent Director) Robert Barclay (Non-Executive Director) Russell Down (Chief Executive) Chris Morgan (Group Finance Director)
On 25 July 2016, your Board announced that it had received a requisition notice to convene a general meeting from Morgan Stanley CS Nominees (as nominee of and on the instructions of Toscafund). Toscafund is the investment manager of the Tosca Funds, the beneficial owners of approximately 17.8% of the Shares in Speedy (the 'Tosca Shares'). Morgan Stanley CS Nominees acts on the instructions of Toscafund in respect of its dealings with the Tosca Shares. Funds under management by Toscafund have an aggregate shareholding of approximately 19.5% of the Shares in Speedy.
There are two resolutions to be considered and voted upon at the General Meeting which has been requisitioned at the behest of Toscafund. The first resolution calls for the removal of Jan Åstrand, the Company's Chairman, from the Board. The second resolution calls for the appointment to the Board of David Shearer as a non-executive director. Toscafund's statement in relation to these resolutions is set out in Appendix 1.
In essence, Toscafund makes three arguments. These relate to (i) Toscafund's belief that Speedy should prioritise participating in sector consolidation (see paragraph 3 below); (ii) governance (see paragraph 4 below); and (iii) business performance (see paragraph 5 below).
This document contains the Notice of the General Meeting, which is to be held at 11.00 a.m. on 9 September 2016 at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ, at which the Resolutions will be considered.
Before addressing in detail Toscafund's arguments, it is important that Shareholders know the extent to which your Board has engaged with Toscafund since Jan Åstrand was appointed Chairman in November 2014.
In the 21 months since Jan Åstrand's appointment, your Directors have received numerous letters and emails from Toscafund and there have been no fewer than 11 meetings, a number of which have been joined by a representative of Schroders, the investment manager of funds holding approximately 11.0% of the Shares in Speedy.
The correspondence and meetings, which have included site visits, have covered Toscafund's questions around corporate governance, business performance and sector consolidation, in particular Toscafund's promotion of HSS as a merger candidate.
Appendix 2 sets out a schedule of the meetings and calls between your Board and Toscafund since Jan Åstrand's appointment as Chairman. This is by some margin significantly more than the interaction your Board has had with any other Shareholder in that period.
Your Board, of course, fully recognises the importance of, and prioritises, regular shareholder engagement.
However, your Board believes that the requisition at the behest of Toscafund after such extensive engagement is an unnecessary distraction. The requisition has been served approximately one month after Toscafund instructed Morgan Stanley CS Nominees to issue to the Company, and then withdraw, a similar requisition notice, and shortly after the Annual General Meeting on 13 July 2016, at which both Toscafund and Schroders instructed each of its nominees to vote against the election of Robert Contreras and Robert Barclay as Directors of the Company. It is proving both costly and disruptive to the business, which is at an early stage in its recovery, with senior management, staff and customer retention a cause for concern.
The UK equipment rental market is highly fragmented. Your Board recognises that, subject to specific transaction terms and conditions, levels of synergies and associated execution risks, sector consolidation could create incremental shareholder value compared to organic growth alone.
Your Board has regularly retained advisers to assess the merits of certain acquisitions or mergers with other sector participants. Your Board compares the benefits and execution risks of potential acquisitions or mergers against its then current organic growth plans to arrive at a judgement as to which course of action to follow in the best interests of Shareholders as a whole.
On 12 January 2015, prior to HSS's initial public offering ('IPO') in February 2015, Toscafund (which then managed funds holding approximately 11.5% of the Shares in Speedy) first asked your Board to consider a combination of Speedy and HSS. After a preliminary assessment, the Board concluded on 27 January 2015 that combining with HSS at that time would not be in the best interests of Shareholders as a whole.
On 14 July 2015, Toscafund wrote to Jan Åstrand and introduced him to Alan Peterson, the chairman of HSS. Over the coming months, Jan Åstrand met the HSS chairman on a number of occasions to better understand the merits of a combination and also the current trading performance of both companies.
On 5 October 2015, Toscafund again wrote to your Board asking that it once again consider merging with HSS. By this time, and following a number of profit warnings, HSS's market value had fallen circa. 71% from £325m at IPO to approximately £93m.
A meeting was held on 30 November 2015, attended by the HSS and Speedy chairmen, the companies' respective financial advisers and a representative of Exponent (the largest shareholder in HSS holding an approximate 50.4% shareholding). No proposal was tabled by either company and it was concluded that, at this very preliminary stage, each party should consider further, in the context of then increasingly challenging market conditions, whether the possible benefits sufficiently outweighed the execution and integration risks of a combination.
On 3 December 2015, following press speculation, Jan Åstrand and Russell Down, then the only two directors of Speedy determined that Speedy should announce it was not considering a combination with HSS. To have done otherwise, given the very preliminary nature of the previous discussions with HSS and the execution risks arising from integrating a corporate acquisition, would in the Board's view have materially risked undermining the organic recovery plan.
In January 2016, funds managed by Toscafund increased their holdings in HSS above 5%.
In early March 2016, HSS made contact with Speedy to once again discuss a possible combination of Speedy with HSS.
On 17 May 2016, Speedy announced its business had stabilised and was starting to respond to management's remedial action plans, a point reinforced at the Annual General Meeting on 13 July 2016, when the Board confirmed that the results for the current year would be slightly ahead of expectations.
During May and June 2016, Jan Åstrand and Russell Down met with members of the HSS board of directors on a number of occasions. The focus of these meetings was to mutually assess the current and likely near-term performance of their respective businesses as a basis for a possible combination. Following a detailed analysis of the information available and a considered review of its strategic options, your Board, having also taken independent financial advice, concluded unanimously that entering into a transaction at this time would jeopardise the potential for operating and financial improvements on a standalone basis and that this risk outweighed any potential merger benefits. Consequently the Board unanimously concluded that entering into a transaction with HSS at this time would not be in the best interests of all Shareholders.
On 21 June 2016, on behalf of the Board, Jan Åstrand met Toscafund to explain that the Board had undertaken further meetings and analysis concerning a potential HSS combination. A representative of Schroders was also present at the meeting. Jan Åstrand advised both parties that the Board had concluded that at this time a combination would not be in the best interests of Shareholders as a whole. Toscafund asked that the Board re-consider its decision noting that it had the power to convene a general meeting of the Company to change the Board.
On 22 June 2016, your Board met and was briefed on Toscafund's wish that, despite the Board's conclusions following discussions with HSS, in Toscafund's view, a merger should still be pursued. After taking Toscafund's views into account, your Board re-iterated its conclusion not to pursue a combination with HSS at this time.
Your Board's conclusion was communicated to Toscafund on 23 June 2016. Later that day Toscafund instructed Morgan Stanley CS Nominees to send a general meeting requisition notice to consider the removal of Jan Åstrand from, and the appointment of David Shearer to, the Board.
This was then withdrawn at your Board's request to facilitate meetings with David Shearer, whom Toscafund had formerly proposed as a director. This initiative by your Board proved unsuccessful and on 22 July 2016, Toscafund instructed Morgan Stanley CS Nominees to submit a general meeting requisition notice once again.
During the period between January 2016 and June 2016, funds managed by Toscafund had further increased their shareholdings in HSS and Speedy from approximately 5.4% and 18.1% to approximately 18.1% and 19.4% respectively.
Appendix 3 sets out a schedule of the meetings and calls which took place between Speedy, HSS and Exponent over the period between 31 July 2015 and 12 June 2016.
There are three aspects of governance of which the Independent Board believes Shareholders should be aware. The first relates to the circumstances in which the Board appointed Jan Åstrand as Executive Chairman, the second relates to the composition of the Non-Executive Directors and the third to interactions with David Shearer.
After a period of significant underperformance, two profit warnings and multiple changes of executive directors, Jan Åstrand was appointed Chairman on 11 November 2014. One of his first actions was to initiate a review of the business which he completed in early January 2015.
Jan Åstrand concluded that the Group had lost operating focus, had weak management systems and sub-par senior management in many roles.
Over the next six months Jan Åstrand's focus was on implementing a recovery plan including:
In June 2015, Jan Åstrand conducted an urgent review into the slower than expected start to the 2015/2016 financial year. He then took immediate and decisive action to arrest the declining revenue performance.
On 1 July 2015, the Group issued a profit warning and announced the departure of the Chief Executive, Mark Rogerson. The Board appointed Russell Down as Chief Executive who, pending the appointment of a replacement, retained his responsibilities as Group Finance Director and was the only Executive Director on the Board. It was in these circumstances that the Board appointed Jan Åstrand as Executive Chairman to support Russell Down in the urgent stabilisation of the business and to ensure the rapid implementation of the previously agreed remedial action programmes.
Throughout this period, the Board regularly liaised with the Group's major Shareholders and kept them updated on progress. On 15 July 2015, at the 2015 Annual General Meeting, Jan Åstrand and Russell Down were elected as Directors by the Shareholders with 97.7% and 99.4% of proxy votes in favour respectively. Importantly, Toscafund instructed its nominee, Morgan Stanley CS Nominees, to vote in favour of Jan Åstrand's appointment to the Board.
Jan Åstrand had hoped to revert to Non-Executive Chairman as soon as was practicable and no later than November 2015. However, the range of operational issues facing the business, as confirmed in a second profit warning on 28 September 2015, and the ongoing search for a new Group Finance Director, meant that it would have been inappropriate to do so. Following the appointment of Chris Morgan as Group Finance Director on 1 April 2016 and with an improved outlook for the business, it was announced on 17 May 2016 that Jan Åstrand had agreed with the Board that he should revert to Non-Executive Chairman 'in the near future'.
Following an encouraging first quarter of the current financial year and indications that the Group's recovery is continuing into the second quarter, the Board has agreed with Jan Åstrand that he will return to a non-executive role with effect from 30 September 2016.
During his tenure as Executive Chairman, Jan Åstrand has worked closely with Russell Down to restructure the business and implement the remedial action programmes, which have resulted in the recent performance improvements. Jan Åstrand and the Board recognise the significant progress made whilst Russell Down has been Chief Executive, and remain fully supportive of him in this role.
In June 2015, the Board comprised three non-executive directors (Jan Åstrand, Chairman; Chris Masters; and James Morley) and two executive directors (Mark Rogerson, Chief Executive; and Russell Down, Group Finance Director). Following the departure of Mark Rogerson and appointment of Jan Åstrand as Executive Chairman, certain Shareholders, including Toscafund (in its capacity as investment manager of the Tosca Funds), supported a refreshment of the Board with the appointment of new non-executive directors.
The Board had previously concluded that a search for new non-executive directors should place an emphasis on candidates with complementary skills and experience.
The search for new non-executive directors took on an added urgency when, in November 2015, the Group's two non-executive directors, Chris Masters and James Morley, both resigned leaving only Jan Åstrand and Russell Down on the Board. The Board sought recommendations from its advisers and major Shareholders. There were two final candidates under consideration at that time: David Shearer, who had stepped down as Chairman of MRBL Limited ('Mouchel') on 28 February 2014, prior to its announced sale to Kier Group in April 2015, who was recommended by Toscafund as having particular financial turnaround experience; and Robert Contreras, because of his successful operational turnaround experience and who was also known to Jan Åstrand from the latter's time as a non-executive director at Northgate plc.
Unfortunately, David Shearer indicated that he was evaluating a number of options and was not in a position to make an immediate commitment to Speedy in the short-term.
Robert Contreras was immediately available and he was subsequently appointed as a Non-Executive Director in December 2015.
Following an exhaustive search for a further non-executive director with industry, operational and sales and marketing experience, Robert Barclay, Managing Director UK & Ireland of SIG plc, a market leading supplier of specialist products to the building and construction industry, was appointed as a Non-Executive Director in April 2016. His considerable sector knowledge and experience have proved invaluable in the execution of the recovery plan. The appointments of Robert Contreras and Robert Barclay were approved by the Shareholders at the AGM on 13 July 2016.
The composition of the Board is continually assessed. Speedy and its Directors regularly receive unsolicited proposals both directly and from intermediaries, suggesting individuals who may be interested in seeking positions as non-executive directors or in operational roles. The Directors assess such opportunities as they arise, however the appointment of directors remains a matter for the Nomination Committee and the Board.
Following the meeting with Toscafund on 23 June 2016, at which Jan Åstrand confirmed the Board's decision not to consider a merger with HSS, Toscafund instructed Morgan Stanley CS Nominees to submit a requisition notice to convene a general meeting of the Company to consider the removal of Jan Åstrand from, and the appointment of David Shearer to, the Board.
The Board suggested to Toscafund through the Company's brokers that there should be further meetings with David Shearer and that to facilitate these Toscafund should instruct Morgan Stanley CS Nominees to withdraw the requisition, which they did.
Accordingly, Robert Contreras, Senior Independent Director, met David Shearer on 6 July 2016 to discuss his credentials for joining the Board. David Shearer informed Robert Contreras that, if invited, he would only join the Board if Jan Åstrand resigned and he (David Shearer) would become Chairman. David Shearer offered no justification for this conditionality of becoming a Board member.
Given that the Independent Board Directors are fully supportive of Jan Åstrand remaining as Chairman, your Board concluded that there was no basis for any further discussions regarding David Shearer as a potential non-executive director.
Toscafund then instructed Morgan Stanley CS Nominees to send a second requisition which was received by email at 6.00 p.m. on Friday 22 July 2016.
The historic underperformance of the Group and the scale of the problems inherited by the current Board and management team are well-documented. These culminated in the announcement on 1 July 2015 that a Board-initiated review had identified a number of factors which had contributed to poor revenue performance and which warned that the results for the year ended 31 March 2016 would fall short of expectations. This was followed by a subsequent downward revision of expectations for the year ending 31 March 2016 on 28 September 2015, and confirmed on 17 May 2016 when the Group announced a decline in revenues and profits for the 2016 financial year.
However, whilst poor, the results were in line with the Board's expectations. The results announcement evidenced the implementation by Russell Down of a number of remedial actions and noted that the business had been stabilised. In addition it was reported that the business was starting to respond to the various initiatives put in place:
'Partial recovery was seen in the final quarter and a number of new contract wins and renewals were secured in the year'. (Source: FY2016 annual results statement of 17 May 2016 and the Annual Report and Accounts 2016).
The Board was pleased to further announce at the recent Annual General Meeting on 13 July 2016 that:
'The Group has enjoyed a positive start to the year with revenues in the first quarter ended 30 June 2016 slightly ahead of the comparable period…The Board believes that the Group's strategy and recovery plan provide the platform for full year results to be slightly ahead of the Board's previous expectations'.
The improvement in the Group's performance has continued into the second quarter of the current financial year and is illustrated by the chart below showing the percentage change in Group revenue compared to the equivalent period the prior year.
As demonstrated above the recovery plan, which has been developed and implemented by Jan Åstrand and Russell Down, has stabilised the business which is now showing signs of revenue growth. This has been achieved through strengthening senior management, improving customer service and relationships, significant improvements in management information systems, setting out clear financial KPIs and driving these throughout the business. Encouragingly, the business has retained a number of major framework contracts since 31 March 2016. In addition overheads have been reduced significantly over the last twelve months through a dedicated focus on costs.
Whilst much remains to be done, the Independent Board Directors believe the continued execution of the recovery plan will deliver value for all Shareholders.
The Independent Board believes that Speedy's recovery is now established, as evidenced by the improving revenue trend, and is a direct consequence of Jan Åstrand's immediate and urgent responses to the downturn in trading in June 2015.
In view of the progress made to date, the Board has agreed that the time is right for Jan Åstrand to return to a non-executive role.
With the business now stabilised, and in anticipation of the successful turnaround of your Company, the Board, which has already been significantly strengthened by the appointment of Robert Contreras, Robert Barclay and Chris Morgan, will be giving consideration to the appropriate structure and composition of the Board to take Speedy into the next phase of its development. This will ensure transparent, structured and orderly succession planning, minimising disruption to the business.
The Independent Board does not believe that Speedy should merge with HSS at this time as Toscafund is advocating. Your Company's recovery is progressing well and to engage in any sector consolidation would potentially put that recovery at risk.
For the purposes of Rule 2.8 of the Takeover Code, Speedy continues to have no intention of making an offer for HSS.
are, in each case, NOT in the best interests of the Company or Shareholders, as a whole, and the Independent Board therefore unanimously recommends that all Shareholders VOTE AGAINST the Resolutions.
You will find, set out at the end of this document, the Notice convening the General Meeting, to be held at 11.00 a.m. on 9 September 2016 at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ, at which the Resolutions will be considered. The full text of the Resolutions is set out in the Notice. Voting at the General Meeting will be by poll and not on a show of hands and each Shareholder entitled to attend and who is present in person or by proxy will be entitled to one vote for each Share held.
You will find enclosed with this document a Form of Proxy for use at the General Meeting or any adjournment thereof. Whether or not you intend to be present at the General Meeting, you are requested to complete and sign the Form of Proxy in accordance with the instructions printed on it so as to be received by the Company's registrars, Equiniti Limited, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, as soon as possible, and in any event, no later than 11.00 a.m. on 7 September 2016 (or, in the case of an adjournment, not later than 48 hours (excluding non-working days) before the time fixed for the holding of the adjourned meeting).
Guidance on completing your Form of Proxy is set out on page 9 of this document.
If you hold Shares in CREST and you wish to appoint a proxy or proxies for the General Meeting or any adjournment(s) thereof by using the CREST electronic proxy appointment service, you may do so by using the CREST proxy voting service in accordance with the procedures set out in the CREST manual. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider, should refer to that CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf. Proxies submitted via CREST (under CREST ID RA19) must be sent as soon as possible and, in any event, so as to be received by the Company's registrars, Equiniti Limited, by no later than 11.00 a.m. on 7 September 2016 (or, in the case of an adjournment, not later than 48 hours (excluding non-working days) before the time fixed for the holding of the adjourned meeting).
If you have any questions relating to this document, the General Meeting and/or the completion and return of the Form of Proxy, please telephone Equiniti Limited on 0371 384 2769. If you are outside the United Kingdom, please call +44 (0)121 415 7047. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 8.30 a.m. and 5.30 p.m., Monday to Friday (excluding public holidays in England and Wales). Please note that Equiniti Limited cannot provide any financial, legal or tax advice and calls may be recorded and monitored for security and training purposes.
The completion and return of a Form of Proxy (or the electronic appointment of a proxy) will not preclude you from attending and voting in person at the General Meeting or any adjournment thereof, if you wish to do so and are so entitled.
Yours faithfully,
Robert Contreras Senior Independent Director
Robert Barclay Non-Executive Director
Russell Down Chief Executive
Chris Morgan Group Finance Director
The shareholding information relating to the Company and HSS expressed in this letter and elsewhere in this document has been sourced, in respect of the Company, from the Company's own share register analysis and, in respect of HSS, from public announcements of shareholdings. The shareholding percentages set out herein represent the latest information available for the date of that event, rather than the shareholding as of each particular date (shareholders are not obliged to announce all changes in their shareholdings). All shareholding percentages expressed in this letter and elsewhere in this document have been rounded to one decimal place.
The Independent Board unanimously recommends that you VOTE AGAINST the Resolutions
To follow the Independent Board's recommendation, you should complete the Form of Proxy as shown below:
STEP 1
For use by ordinary shareholders at the General Meeting to be held at 11.00 a.m. on 9 September 2016 at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ.
I/We, the undersigned, being (a) member(s) of the above-named Company, hereby appoint the Chairman of the meeting
.................................................................................................................................................... regarding ........................................................................................shares
(if it is desired to appoint another person as proxy delete 'the Chairman of the meeting', initial the alteration and insert the name and address of the proxy, who need not be a member of the Company)
as my/our proxy to vote on my/our behalf as indicated below (or, if no such indication is given, at his/her discretion) at the General Meeting of the Company to be held at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ on 9 September 2016 at 11.00 a.m. and at any adjournment thereof, on the Resolutions set out below, and on any other business arising at the General Meeting and at any adjournment thereof.
If you wish to appoint multiple proxies please insert 'X' in this box and see note 2.
| Ordinary Resolutions | For | Against | Vote withheld |
|
|---|---|---|---|---|
| 1. That Jan Åstrand be and is hereby removed from office as a director of the Company. |
X | |||
| 2. That David Shearer be and is hereby appointed as a director of the Company. |
X |
Please indicate in which way you wish your proxy to vote by inserting 'X' in the appropriate box. Unless otherwise instructed, the proxy will vote as he thinks fit or abstain from voting.
| Date: 2016 | STEP 2 |
|---|---|
| Signature(s) or common seal: | SIGN and DATE here |
| Full name(s): | |
| Address: |
STEP 3
Return by post or (during normal business hours only) by hand to Equiniti Limited, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, as soon as possible, and in any event, no later than 11.00 a.m. on 7 September 2016 (or, in the case of an adjournment, not later than 48 hours (excluding non-working days) before the time fixed for the holding of the adjourned meeting).
The board of Speedy Hire has regularly failed to engage with shareholders on matters to do with the appointment of key directors. There was no such active engagement ahead of the appointment of Jan Astrand to the board of Speedy Hire on 1 November 2014 and as Executive Chairman on 1 July 2015. The more recent appointments of Robert Contreras and Robert Barclay followed the same pattern.
Jan Astrand has overseen appointments of independent directors at Speedy Hire which Toscafund believes are contrary to good governance and accountability of the executive chairman. Jan Astrand had a long business relationship with Robert Contreras prior to the latter being appointed to the board of Speedy Hire in December 2015 and nominated as Senior Independent Director in March 2016.
of strategic business development globally and extensive advisory expertise in M&A, Capital Raising, Private Equity and Restructuring in both the listed and private equity arenas.
Appointed as Chairman to this Consulting Engineering and Support Services business following a series of profit warnings, appointment of a new CEO and the resignation of two successive Chairmen. Led the board through a process to stabilise the business with support from the bank syndicate; develop and implement a turnaround strategy and manage the multiple stakeholders through a financial restructuring involving a debt for equity swap in August 2012. A consequence of this involved raising additional finance to buy out a partner in a key strategic joint venture with support from the banks. The business returned to a strong level of profitability with record order book and normalised debt levels and its sale was concluded with Kier Group plc in June for an equity value of c£265million with a full recovery of bank debt and a return of 3x on the equity conversion at the time of the restructure.
Appointed by the bank syndicate to this privately owned hotel group which had an inappropriate capital structure, some operational weaknesses and a board struggling to address the issues brought on by the financial crisis with the completion and opening of two new large hotels in the UK and the Netherlands. Implemented a clear plan to stabilise the business with support from the banks and coordinated a managed sale process resulting in the sale to Blackstone for £610million ensuring full recovery for the bank syndicate of otherwise impaired debt and creating value for shareholders.
| Date | Meeting | Other attendees | Speedy attendees |
|---|---|---|---|
| 13 May 2015 | Prelim results roadshow | Toscafund Daniel Cane Martin Hughes |
Russell Down Mark Rogerson |
| 2 June 2015 | Tamworth NDC visit | Toscafund Daniel Cane |
Russell Down Mark Rogerson Neil Marks |
| 1 July 2015 | Call following MR resignation | Toscafund Daniel Cane |
Russell Down |
| 2 July 2015 | Additional call following MR resignation |
Toscafund Daniel Cane |
Russell Down |
| 6 July 2015 | Meeting | Toscafund Martin Hughes Daniel Cane Schroders Andy Brough (unexpected)* |
Jan Åstrand |
| 22 July 2015 | Meeting | Toscafund Martin Hughes |
Jan Åstrand |
| 1 September 2015 | Call | Toscafund Martin Hughes |
Jan Åstrand |
| 11 September 2015 | Call | Toscafund Martin Hughes |
Jan Åstrand |
| 28 October 2015 | Meeting | Toscafund Martin Hughes Schroders Andy Brough (unexpected)* |
Jan Åstrand Russell Down |
| 8 November 2015 | Call | David Shearer | Jan Åstrand |
| 9 November 2015 | Call | Toscafund Martin Hughes |
Jan Åstrand |
| 10 November 2015 | Interim results roadshow | Schroders Rosemary Banyard Iain Staples Andy Brough |
Russell Down James Blair |
| 10 November 2015 | Interim results roadshow | Toscafund Daniel Cane Martin Hughes |
Russell Down James Blair |
| 11 November 2015 | Drinks | David Shearer | Jan Åstrand |
| 15 December 2015 | Call | David Shearer | Jan Åstrand |
| 8 January 2016 | Call | Toscafund Daniel Cane |
Russell Down Chris Morgan |
| 12 February 2016 | Call | Toscafund Martin Hughes |
Jan Åstrand |
| 21 March 2016 | Erith MSC visit | Toscafund Daniel Cane Chris Morgan Steve Palmer |
Russell Down |
| 21 March 2016 | Call | Toscafund Martin Hughes |
Jan Åstrand |
| 29 March 2016 | Meeting | Toscafund Martin Hughes |
Robert Contreras |
| 17 May 2016 | Prelim results roadshow | Toscafund Daniel Cane |
Russell Down Chris Morgan |
| Date | Meeting | Other attendees | Speedy attendees |
|---|---|---|---|
| 21 June 2016 | Meeting | Toscafund Martin Hughes Schroders Andy Brough (unexpected)* |
Jan Åstrand |
| 23 June 2016 | Meeting | Toscafund Martin Hughes |
Jan Åstrand |
| 5 July 2016 | Meeting | David Shearer | Jan Åstrand |
| 6 July 2016 | Meeting | David Shearer | Robert Contreras |
* Unknown to Jan Åstrand that Andy Brough (of Schroders) would be attending the meeting.
| Date | Meeting | Other attendees | Speedy attendees |
|---|---|---|---|
| 31 July 2015 | Meeting | HSS Alan Peterson |
Jan Åstrand |
| 10 August 2015 | Meeting | HSS Chris Davies |
Jan Åstrand |
| 14 August 2015 | Meeting | Exponent Oli Bower |
Jan Åstrand |
| 26 August 2015 | Meeting | HSS Alan Peterson |
Jan Åstrand |
| 3 September 2015 | Call or Meeting | HSS Alan Peterson |
Jan Åstrand |
| 16 October 2015 | Meeting | HSS Alan Peterson |
Jan Åstrand |
| 4 November 2015 | Meeting | HSS Alan Peterson |
Jan Åstrand |
| 30 November 2015 | Meeting | HSS Alan Peterson JP Morgan R Constant Exponent T Sweet Escott |
Jan Åstrand Rothschild John Deans Neil Thwaites |
| 2 December 2015 | Meeting | HSS J Gill |
Jan Åstrand |
| 7 or 8 March 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
| 15 April 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
| 18 April 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
| 26 April 2016 | Dinner | HSS Alan Peterson |
Jan Åstrand |
| 4 May 2016 | Call | HSS John Gill |
Jan Åstrand |
| 6 May 2016 | Meeting | HSS John Gill |
Russell Down |
| 11 May 2016 | Call | HSS John Gill |
Jan Åstrand |
| 12 May 2016 | Calls (x4) | HSS Alan Peterson |
Jan Åstrand |
| 19 May 2016 | Meeting | HSS Alan Peterson |
Jan Åstrand |
| 19 May 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
| 2 June 2016 | Meeting | HSS Alan Peterson John Gill |
Jan Åstrand Russell Down |
| 9 June 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
| 11 June 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
| 12 June 2016 | Call | HSS Alan Peterson |
Jan Åstrand |
The following definitions apply throughout this document unless the context otherwise requires:
| 'Board' | the current board of directors of the Company |
|---|---|
| 'Company' or 'Speedy' | Speedy Hire Plc, a public limited company registered in England and Wales with registered number 927680 |
| 'CREST' | the relevant system (as defined in the Regulations) in respect of which Euroclear is the operator (as defined in the Regulations) |
| 'CREST Manual' | the CREST manual consisting of the CREST reference manual; CREST international manual; CREST central counterparty service manual; CREST rules; CCSS operations manual and CREST glossary of terms available at http://www.euroclear.com |
| 'CREST Proxy Instruction' | a properly authenticated CREST message appointing and instructing a proxy to attend and vote in place of a shareholder at the General Meeting and containing the information required to be contained in the CREST Manual |
| 'Directors' | the directors of the Company |
| 'Euroclear' | Euroclear UK & Ireland Limited |
| 'Exponent' | Exponent Private Equity LLP, a limited liability partnership, registered in England and Wales with registered number OC306781 |
| 'Form of Proxy' | the Form of Proxy enclosed with this document, for use by Shareholders in connection with the General Meeting |
| 'General Meeting' | the general meeting of the Company to be held at 11.00 a.m. on 9 September 2016 (and any adjournment thereof) for the purposes of considering and, if thought fit, passing the Resolutions |
| 'Group' | the Company and its Subsidiaries |
| 'HSS' | HSS Hire Group plc, a public limited company in England and Wales with registered number 09378067 |
| 'Independent Board' | comprising Robert Contreras, Robert Barclay, Russell Down and Chris Morgan, the Directors not having a direct or indirect interest that conflicts with, or may conflict with, the recommendation to be given to Shareholders as to how to vote in respect of the Resolutions proposed by Morgan Stanley Client Securities Nominees Limited (as nominee of and on the instructions of Toscafund Asset Management LLP) |
| 'Independent Board Directors' | the Directors comprising the Independent Board |
| 'Morgan Stanley CS Nominees' | Morgan Stanley Client Securities Nominees Limited, a private limited company registered in England and Wales with registered number 09655385. It is expressly noted that Morgan Stanley is acting solely as nominee for the Toscafund and not on behalf of any Morgan Stanley entity |
| 'Notice' | the notice of the General Meeting set out on pages 19 to 21 (inclusive) of this document |
| 'Regulations' | the Uncertificated Securities Regulations 2001 of the United Kingdom |
| 'Resolutions' | the ordinary resolutions to be proposed at the General Meeting (and set out in the Notice contained in this document): • to remove Jan Åstrand as a director of the Company; and • to replace him with David Shearer |
| 'Schroders' | Schroders plc, a public limited company, registered in England and Wales with registered number 03909886 |
| 'Shareholder' | the holders of Shares from time to time |
| 'Shares' | the ordinary shares of 5 pence each in the capital of the Company, having the rights set out in the articles of association of the Company |
|---|---|
| 'Subsidiary' | has the meaning given thereto in section 1159 of the Companies Act 2006 |
| 'Takeover Code' | the City Code on Takeovers and Mergers as from time to time interpreted by the Panel on Takeovers and Mergers |
| 'Toscafund' | Toscafund Asset Management LLP, a limited liability partnership registered in England and Wales with registration number OC320318 |
| 'Tosca Funds' | Tosca Opportunity and Tosca Mid Cap |
| 'Tosca Shares' | has the meaning given thereto on page 3 of this document |
| 'UK' or 'United Kingdom' | the United Kingdom of Great Britain and Northern Ireland |
| 'UK Corporate Governance Code' | the UK corporate governance code as published by the Financial Reporting Council |
| 'pence', 'pounds sterling', 'sterling', '£' or 'p' | the lawful currency of the United Kingdom |
All times referred to are London time unless otherwise stated.
All references to legislation in this document are to the legislation of England and Wales unless the contrary is indicated. Any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof.
Words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine or neutral gender.
(Incorporated and registered in England and Wales under the Companies Act 2006 with registered number 927680)
NOTICE IS HEREBY GIVEN that a general meeting of the shareholders of Speedy Hire Plc (the 'Company') (the 'General Meeting') will be held at 11.00 a.m. on 9 September 2016 at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ, for the purpose of considering and, if thought fit, passing the following resolutions, each of which shall be proposed as ordinary resolutions:
Dated: 12 August 2016
Chase House 16 The Parks Newton-le-Willows Merseyside WA12 0JQ James Blair
Registered office: By order of the Board
Company Secretary
(v) If conflicting proxies are sent or received at the same time in respect of (or deemed to be in respect of) an entire holding, none of them shall be treated as valid.
(vi) Where the aggregate number of shares in respect of which proxies are appointed exceeds a member's entire holding and it is not possible to determine the order in which they were sent or received (or they were all sent or received at the same time), the number of votes attributed to each proxy will be reduced pro rata.
(k) A 'vote withheld' option is provided on the Form of Proxy which is to enable a member to withhold their vote on a particular resolution. It should be noted that a vote withheld is not a vote in law and will not be counted in the calculation of the proportion of votes 'for' or 'against' a resolution.
(l) As at 9 August 2016 (being the latest business day prior to the publication of this notice), the Company's issued share capital consists of 523,452,759 ordinary shares of five pence each, carrying one vote each. Every member has one vote on a show of hands and on a poll one vote for each share held.
Chase House 16 The Parks Newton-le-Willows Merseyside WA12 0JQ
www.speedyservices.com
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