Illustrated book publisher Quarto was subjected to a shareholder revolt today at its AGM, which saw four directors booted off the board.
Shareholders Chuk Kin Lau and ex-chief executive Laurence Orbach, who together own around 47 per cent of the company, voted to dismiss the four non-executive board members.
As replacements, they re-elected Orbach and Lau themselves, Laus colleague Mei Lan Lam and Quartos ex-chief financial officer Mick Mousley who retired in 2015.
But Paul Mumford of Cavendish Asset Management, a minority shareholder, held reservations about the shake-up.
“A cynical person would look at this and call it a takeover on the cheap, with an in-built conflict of interest as the cherry on the cake,” he said.
The main concerns surround the fact that Lau, through his printing company Lion Rock Group, is understood to be a customer of Quarto.
Despite this, Mumford said he welcomed the chance for change at a company which seemed reluctant to reduce its massive £47m debt burden, as it stood at the end of last year. Quarto has a £23.5m market value.
Yet there could be more conflict to follow. City A.M. understands that where Lau may be keen to cut dividends in order to restructure the business and reduce the debt pile, Orbach hopes to maintain dividends.
Orbach, who served as Quarto's chief executive for 36 years, was dramatically ousted by an activist investor in 2012 after being accused of leading a period of underperformance.
The company's share price has remained low after it issued profit warnings, and a takeover from a mystery buyer last year fell through.