Bubs board spill fails to woo proxy advisers ISS, Glass Lewis

afr.com:

Proxy adviser Institutional Shareholder Services (ISS) is advising its clients to oppose plans to spill Bubs Australia’s existing board and install a new one that includes former a2 Milk executive Peter Nathan.

Its voting recommendations, mailed overnight to clients, said it didn’t make sense for Bubs shareholders to rock the boat, given the alternative wasn’t much better.

Former A2 Milk executive Peter Nathan has failed to woo proxy advisers.  Eamon Gallagher

“A vote AGAINST [sic] all resolutions is warranted having regard to the lack of a detailed case for change from the dissident, pending legal procedures and the upcoming AGM in four months, as well as the potential conflict of interests arising from the election of the dissident nominees,” the report said.

It’s a setback for Bubs’ former boss Kristy Carr, who is leading a group of dissident investors, including former executive chair Dennis Lin, co-founder Anthony Gualdi, and its largest Chinese customer AZ Global – as revealed by Australian Financial Review in May. Chemist Warehouse’s Jack Gance and Stable Charter are also supporters.

Bubs shareholders will vote on seven proposals on July 27: four to remove existing directors Paul Jensen, Steve Lin, Reg Weine and Katrina Rathie, and three to bring in new ones including James Jackson (ex Elders), Peter Nathan (ex A2) and Rupert Soar (ex Fonterra).

Glass Lewis is on the same page as Bubs’ board and ISS in recommending shareholders vote against the board spill.

At the centre of the mayhem is Bubs’ terrifying share price performance. It is down 50 per cent in a year, and 80.7 per cent over the past three years to July 3. It has racked up accumulated losses of $240 million since its 2017 listing and raised seven times,