A disgruntled shareholder has accused the board of Birmingham engineering firm Metalrax of mismanaging its underperforming subsidiaries and providing "jobs for the boys".
William Hodgson, a private investor from Arundel in West Sussex, deluged the board with questions about the Birmingham-based firm's performance at its annual meeting yesterday.
He criticised directors for a seven-year decline in earnings per share.
He also claimed that they had failed to cut the cost of labour, appointed too many non-executive directors, failed to cut debt and badly managed subsidiaries.
Chairman John Crabtree told yesterday's AGM that in the first four months of the current year group turnover and orders were up over the same period last year.
However, operating profits had been hit by a number of factors outside the group's control.
These included the downturn in consumer spending, the closure of MG Rover and Powertrain and steel and energy price increases.
Metalrax chief executive Richard Arbuthnot said the firm recognised that not all of its subsidiaries would be " going up the growth rank", but said this was part of the natural cycle of " growth, stabilisation and renewal".
" By holding a diverse number of businesses, Metalrax can thus provide stable growth for its shareholders," Mr Arbuthnot said.
He also said the company had been attempting to reduce the cost of labour, but noted that certain businesses - such as the Bacol subsidiaries in Smethwick and Bromsgrove - incurred heavier costs due to the nature of their work.
On the subject of Metalrax's three non-executives, Mr Arbuthnot said they were required in order to develop a good relationship with staff across a diverse organisation.
In September the group, which employs three quarters of its 1,800 workforce in the Midlands, reported a slight dip in inerim profits to £5.23 million on sales of £50.58 million.
However, shareholders backed the Metalrax board, with one labelling Mr Hodgson's questions as " ridiculous", and claiming the investor was "treating the company like a bank".
But Mr Hodgson, who specialises in manufacturing investments, remained disatisfied with the board's response. He predicted that the group was exposing itself to intervention by major institutional shareholders.
He said: "Metalrax has had a flat financial record for five years and they continue to acquire businesses without selling any of their underperforming subsidiaries.
"Looking at the number of board members for a company of this size, it's easy to see that this is a case of jobs for the boys.
"This is a public company, not a charity, and it is trading in a climate of pressure. Unless steps are taken to improve its financial performance then the City will clean it up."