Gibbs calls for GPG spin off proposal to be abandoned
Guinness Peat Group director Tony Gibbs is calling for the abandonment of proposals to spin off the company's Australian business.GPG announced the proposal last week, and also intends floating its thread manufacturer Coats Group within a year.But today M
Guinness Peat Group director Tony Gibbs is calling for the abandonment of proposals to spin off the company's Australian business.
GPG announced the proposal last week, and also intends floating its thread manufacturer Coats Group within a year.
But today Mr Gibbs said he believed a different strategic approach would be preferred by GPG's shareholders.
He had advised the directors of GPG to abandon the plan, rather than spend the next six months investing time and shareholders' money developing the proposal further or seeking modifications.
Among core elements of an alternative strategy he preferred was a cash distribution to shareholders to be paid before the end of the year, and restructuring of GPG to enable an efficient exit of Coats and a future return of funds, Mr Gibbs said.
At the same time the company should prepare for a trade sale or flotation of Coats as soon as practicable after the end of the December 2010 financial year, with the sale or flotation followed by the return of those proceeds to shareholders.
"I have advised the GPG board of this strategy and believe a public statement of my view is important as I intend to engage with our shareholders to better understand their views over the coming weeks," Mr Gibbs said.
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