TORONTO Western Intl. Communications Ltd., one of Canada’s biggest broadcasters, on Wednesday fought off an attempt by unhappy shareholders to split up the company at the annual meeting.
The assault on the Vancouver-based company was led by Oppenheimer and Co., a New York brokerage firm, which argued that the board and management has failed to maximize shareholder values. On the Toronto Stock Exchange, WIC shares have traded well below the C$ 24 ($ 17.50) that CanWest Global Communications Corp. of Winnipeg offered last year in an unsuccessful hostile takeover bid.
WIC is controlled by Vancouver’s Griffiths family, which holds about 62% of the Class A voting shares, but only 7% of the total equity. Another family, the Allards of Edmonton, own 29% of the voting stock. They successfully voted down the resolution to dissolve the company as well as a second motion Oppenheimer presented that would have given Class B nonvoting shareholders the right to elect at least three directors.
Although the motions were defeated, WIC management clearly was stunned by the support the proposals had from nonvoting shareholders. About 56% of the Class B stock was voted in favor of a breakup, vs. 42% against.
“I think you’ve got it backward,” John Lacey, WIC’s new president and CEOtold those counting the ballots. But the tally was correct.
A motion for dissolution of the company is the only matter on which Class B shareholders are entitled to vote. However, it required a two-thirds majority of both classes to be approved.
Oppenheimer managing director Eric Rosenfeld said he was happy with the result, which he said upheld his contention that Class B shareholders have been denied a say in how the company is run.