An extraordinary general meeting of Gresham Hotel Group plc is set to take place on August 8th.
The company yesterday announced its intention to hold such a meeting subject to approval from the Dublin Stock Exchange. Earlier yesterday, Euro Sea Hotels NV, a subsidiary of the Red Sea Hotel Group which holds a 28 per stake in Gresham, said it was convening an e.g.m.
The two companies differed yesterday as to when discussions between them regarding the make-up of the Gresham board ended. While Gresham said the discussions were abandoned yesterday at midday, Euro Sea said Gresham disengaged on Tuesday, July 9th.
Euro Sea issued a press statement yesterday morning to say it was calling an e.g.m. for August 8th. "The decision of Euro Sea Hotels to convene the e.g.m. follows the failure of the Gresham board to notify shareholders of the date for the e.g.m. on or before Friday, July 12th."
The company wants the removal of four Gresham directors: Mr Patrick Bourke, Mr David Bunworth, Mr Sean Henneberry and Ms Laura Magahy; and their replacement by: Mr Amos Pickel, Mr Tom Byrne and Mr Harvey Sonning.
"Since Gresham's a.g.m. in June, Euro Sea Hotels entered into discussions with members of the Gresham board with a view to reaching mutual agreement on the future structure of the board. The board of Gresham disengaged in discussions with Euro Sea on Tuesday, July 9th."
Mr Pickel, a director of Euro Sea, said the company wanted to reconstitute the board of Gresham to create a programme to deliver value to shareholders. "We believe that the Gresham board did not enter into discussions with us in good faith," he said.
A spokeswoman for Gresham said the discussions between the two sides ended at noon yesterday. The company said on July 10th that as discussions between it and Euro Sea were ongoing, it did not intend to convene the e.g.m. at that time. "As discussions are now terminated, the company hereby gives notice of its intention to convene the e.g.m. once the appropriate clearance of a circular", to be sent to shareholders, is made by the Irish Stock Exchange and the UK Listing Authority.
Gresham has confirmed that it has been approached about a possible bid by a consortium led by former NCB stockbroker, Mr Nigel McDermott.
Last month, Red Sea prevented the re-election of three Gresham directors, Mr Jerry Liston, Mr Domenico Venosi and Mr Paul McCracken. Mr Pickel has denied that Red Sea intends to use an e.g.m to take control of Gresham. "The target is to make this company earn money and develop," he told The Irish Times last month. Gresham has challenged Red Sea to make an offer for Gresham.
Ironically, Israeli company Red Sea posted a net loss last year of €7.9 million on turnover of €33 million. This compared with profits of €16 million in 2000.
