Solomon Lew slams ‘passive’ Myer institutional investors

Retail billionaire lashes out at Myer institutional investors, attacks government short termism and instability.

Premier Investments chairman Solomon Lew and CEO Mark McInnes at their office in Melbourne CBD Picture: David Geraghty, The Australian.

Retail billionaire Solomon Lew has ramped up his campaign against large institutional investors who failed to support him in his bid to block the election of three directors to the Myer board last week, as well as vote down other resolutions at the department store’s annual general meeting, slamming them as “passive” when they are supposed to be managing “other people’s money”.

Addressing his shareholders at the Premier Investments (PMV) annual general meeting in Melbourne this morning, Mr Lew also launched a blistering attack on what he termed “10 years of continuous government instability, uncertainty and short-term decision making” where sound economic policy has lost out to political tactics.

Mr Lew warned that Premier Investments would continue to use all of the options at its disposal to protect its Myer investment, ending his comments on Myer with a twist on a popular phrase from one of TV’s highest rating shows at the moment.

“With apologies to fans of The Game of Thrones, my message to the Myer board is this: Summer is coming. The numbers won’t lie.”

There is also no hope Mr Lew might ride to the rescue of failed fashion brand Oroton, which collapsed into voluntary administration yesterday, saying before the meeting he wouldn’t touch Oroton.

“We wouldn’t even look at it for a second, it’s not our space,” Mr Lew told The Australian as he walked into the Premier Investments AGM.

Mr Lew, who is chairman of Premier Investments, said short termism and political instability had contributed to low levels of business and consumer confidence, and suggested that four-year set terms for the federal government might be a solution to the current malaise.

Turning to Premier Investments’ stake in Myer, which is down around $40 million, Mr Lew said to his shareholders it gave him “no joy” as he maintains the Myer board misled him over its financial performance.

That came to a head last week at the Myer AGM where Mr Lew tried to vote down all resolutions, including the re-election of directors. But he failed to gain support from large investors.

Last week Mr Lew hit out at Investors Mutual boss Anton Tagliaferro, Myer’s second biggest shareholder, for not voting with his own Premier Investments to reject all resolutions at the Myer AGM.

Mr Lew’s Premier Investments is Myer’s biggest shareholder with a stake of 10.8 per cent and if Investors Mutual — which has 10 per cent — had voted with him he would have likely won in his campaign to kick out three Myer directors, including incoming chairman Garry Hounsell.

Mr Lew did attract around 10,000 retail investors, however, in his Myer campaign, but he lacked the support of institutional investors.

“The support of thousands of small shareholders is both encouraging and understandable given the massive destruction of value, which is so evident,” Mr Lew said this morning in his chairman’s address at the Premier Investments AGM.

“However the passive role of a number of institutional shareholders, who are responsible for managing other people’s money was deeply disappointing given that they are serving only to delay the inevitable as the (Myer) business continues its very clear downward trajectory and further value is destroyed under this current Myer board.”

Mr Lew said after Myer had “aggressively denied” Premier Investments’ support and retail advice and now “must deliver”.

“For the Myer board to rebuff our retail performance and experience, to protect their own jobs, is bad for the Myer business and shareholders.’’