Livestock shipping company Wellards loses one of its last allies

Embattled livestock shipping company Wellard has lost one of its few remaining allies.

Butt issued a statement slamming Wellard’s corporate governance, remuneration practices and share price performance. Picture: Wesley Monts.

Embattled livestock shipping company Wellard has lost one of its few remaining allies, with the group now at war with a key backer after a spat over its upcoming annual general meeting.

Butt Nominees, a company controlled by Pakistani businessman Tariq Butt and which holds a 14.4 per cent stake in Wellard, on Thursday revealed it would vote its stake against several resolutions at the Wellard AGM later this month.

Butt issued a statement slamming Wellard’s corporate governance, remuneration practices and share price performance after Wellard refused to release a shareholder letter from Butt through the Australian Stock Exchange.

“We never intended this to become a hostile situation but Wellard’s refusal to engage constructively with Butt Nominees and Wellard’s obvious corporate governance failings have left us with no choice,” Butt Nominees’ local director, Tyron Dennison, said in a statement.

The falling out is the latest in a long line of setbacks disasters for Wellard, which was the worst float in Australia last year. The stock debuted at $1.44 a share in December but is now trading at just 22c, having lost more than $450 million in market value.

Mr Dennison is standing as a non-executive director at the AGM, but Wellard’s board declined to make a recommendation on his appointment and chairman David Griffiths will be voting undirected proxies against Mr Dennison.

The comments from Butt came as a shock to Wellard, which had been hoping it could come to a peaceful compromise in a meeting it had scheduled with Butt later in the week.

Butt’s decision to start buying up shares in Wellard in August was critical in arresting a free fall in the company’s stock and putting a floor under the share price. The group was also seen as friendly to Wellard and its management, with Mr Butt considered a friend of Wellard chief executive Mauro Balzarinia after doing business with him over several years.

Mr Dennison said the Wellard board “clearly” lacked independence.

“Butt Nominees, which through Tariq Butt has a longstanding relationship with Wellard and Mr Balzarini, has made clear it wants to help Wellard back onto its feet, and sees Mr Dennison’s appointment to the board as an important and appropriate first step,” Butt said.

“But Wellard’s refusal to let Butt Nominees explain the reasons for its AGM voting intentions and Mr Dennison’s nomination by blocking the release of a shareholder letter through the ASX platform is a further indictment of the Wellard board’s poor approach to corporate governance.”