A boardroom battle at historic firm Victoria Carpets – which has divided the descendants of founder George Anton – has become increasingly bitter.
A consortium headed by Alexander Anton, the great-grandson of the founder and a former chairman of the Kidderminster firm, has submitted plans to take control of the board by replacing two non-executive directors with four of their choice.
But cousin Rupert Anton – also a great-grandson of George Anton and a former Victoria director – opposes the plans, claiming the current management team headed by managing director Alan Bullock was succeeding by remaining in the black amid a tough economic climate.
Rupert Anton says he fears for the future of the century-old firm if the consortium gains control, and Mr Bullock has warned that major customers plan to turn their backs on Victoria if the proposals are realised.
However, speaking on behalf of the consortium, proposed director Geoff Wilding said it has a strategy to improve the fortunes of Victoria by making its UK operation profitable and strengthening in Australia and New Zealand.
Mr Bullock said Alexander Anton had previously failed to garner support to remain as chairman – although the former chairman said he resigned from the role.
He believes the consortium plans to use Mr Wilding’s links with a New Zealand-based retail firm to improve sales, but said this was a flawed plan.
Mr Bullock said: “When Mr (Alexander) Anton was on the board before, he failed to get support to remain as chairman in January 2010 and was dismissed.
“Having served on the board for 15 years, I am interested what new earth-shattering strategies he has that he hadn’t told his colleagues about over the last 15 years.
“Mr Wilding was brought onto the Victoria board in 2009 by Mr Anton. He was brought in because of his shareholding in a New Zealand retail carpet and floor coverings business called Flooring Brands. In Mr Wilding’s case the proposal was that he’ll back Flooring Brands into the business and we could sell them carpet and flooring both in New Zealand and Australia and roll out the same base model in the UK.
“That is really a naive suggestion. How can we manufacture carpets and sell to 3,000 retailers in the UK when we are selling to a group of retailers we own?
“That would be like Marks & Spencer having a facility and expecting Top Shop to be buying from them. It wouldn’t happen, so the board unanimously rejected the proposal.”
Victoria employs 300 people in the UK and 700 worldwide and both groups have said they are committed to retaining current levels of manufacturing.
The consortium says it has support from 46 per cent of existing shareholders and its proposed directors have a proven track record.
It says it does not intend to leverage the business to go on an acquisition spree and would not merge with, or acquire, Flooring Brands, or take the company private.
Mr Wilding said the consortium planned to improve the return to shareholders, and put in place succession plans. He said: “We see it very simply. The current board has failed to create enough value for the shareholders. A practical majority of shareholders are simply exercising their legal right to elect a new board.
“It is not about a change of control – the shareholders control the company and always have – this is simply the shareholders exercising their legal right.”
He added: “This board is desperate to keep their jobs. They are pulling more money out of the company in salaries and fees than shareholders get in dividends. I think that it is right and proper that the shareholders receive a return on the capital they have invested.”
Former investment banker Mr Wilding said the group had been keen to meet the board and discuss the plans, but was surprised to see the firm had been put up for sale minutes before a scheduled meeting on January 13.
He added: “We have spoken to a number of customers, and some of the largest customers who I know very well in Australia and New Zealand, and they support us.
“There are opportunities in Australia and New Zealand that the current business isn’t participating in and we can take it into those areas and grow the business. The UK is basically not profitable at the present time and hasn’t been for years.”
A spokesman for the consortium said Alexander Anton had not been dismissed as chairman, but opted to resign in February 2010.
Rupert Anton, a former communications director at Victoria who now heads up PR firm Sapiens Communications, said he feared for the future of the company if the consortium took over.
He said: “I would have grave concerns about whether the company would be around in five year’s time if they got hold of it. They are doing well at the moment. It is a company that delivers a steady return year after year.
“Wake up and smell the coffee – the company is in the UK manufacturing a consumer durable that is going to the housing market.”
He added: “I am opposed because unlike any of the other family shareholders I have worked in the carpet industry, firstly at Victoria and then at the Carpet Foundation.
“I have probably got more of a handle on how hard things are, how well Victoria Carpets has done and how much they have bucked the trend. The management team and company is very well thought of.”
In a recent trading update Victoria revealed sales in the UK were up by 11.2 per cent in the last quarter of 2011.
Stephen Jones, head of the Birmingham office of Brewin Dolphin, said the business had been performing “quite well” and the consortium had been “underhand” in its attempts to seize control.
He said: “I don’t think anybody can begrudge a management team coming in and putting in a recommendation or an offer for the business but to try and come in through the back door and effectively gain control of the business without paying a premium I think is totally underhand.”
