GPG shareholders vote for $158m payout

Guinness Peat Group shareholders have voted overwhelmingly for a scheme of arrangement to return capital of £80 million ($158 million).

According to provisional results the proposal received votes worth 924.9 million shares, equating to 94.8% shareholder support.

The vote was held ahead of today's annual meeting at Ellerslie in Auckland.  

GPG annual meetings previously were held in London but the company has moved this one to New Zealand after shareholders protested.

GPG is winding up its investment portfolio by selling assets, with the exception of thread maker Coats Group, and return capital to shareholders.

That decision came on the back of intense pressure from local investors and differed from an earlier GPG plan to spin off the Australian unit, which would be run by former Australian director Gary Weiss.

GPG said today it had generated net cash of £92 million ($185 million) this year from asset realisations and £132 million since October.

GPG's New Zealand assets include a 35% stake in insurance company Tower, a 65% stake in fruit and produce company Turners and Growers and a 19.4% stake in car auction company Turners Auctions.

“Whilst GPG will discontinue new investment, as previously announced GPG may allocate further capital to existing investments where this is considered to add value to the divestment strategy for that investment,” chairman Rob Campbell said.

“Investors should expect to see few such investments, but some will be necessary.”

Coats had performed ahead of last year in the first quarter of 2011, it said.

Shareholders have grown increasingly unhappy with the performance of GPG in recent years, with its share price trading about 30% below net asset value.

They were also frustrated by some of the investment decisions made in Australia in particular as well as lucrative compensation packages paid to directors.

At today’s meeting all directors standing for re-election were voted in, including Blake Nixon, the last of the original directors along with founder and former chairman Sir Ron Brierley.

Shareholders also voted in favour of the remuneration report relating to how much directors were paid last year.