Disagreement between Vertex directors turns into public row

A dispute between two factions of listed plastics company Vertex's board erupted publicly yesterday.

On one side are managing director Paddy Boyle and independent director Sandy Maier.

They are asking the High Court to declare the company's other three directors' September board appointments illegal.

The move follows an unsuccessful attempt at a board meeting on Monday to force the three to resign.

On the other side are Mark Stewart, Warwick Webb and chairman Warren Bell.

Stewart and Webb said there was no basis to challenge the validity of their appointments. Bell did not return the Herald's calls.

Vertex manufactures plastic mouldings and packaging.

On September 27, Masthead, Stewart's family company, bought 19.9 per cent of Vertex from Gould Holdings for $2.05 a share - a 24 per cent premium on Vertex's then $1.65 share price.

Stewart and Webb were appointed to Vertex's board. Masthead owns 51.2 per cent of Vertex's competitor, Alto Plastics. Webb is a consultant to Masthead.

Boyle said that since September 27, Vertex's board had been operating in a "very difficult" environment.

Strong protocols had been established to police the passage of information to Vertex board members who controlled "an aggressive competitor", and therefore had a potential conflict of interest. 

"I feel the protocols have not been adhered to as well as they should have been and we had to recognise the whole situation was unworkable," Boyle said.

Boyle and Maier voted against the appointments of Stewart, Webb and Bell but were outvoted by the three outgoing Gould Holdings' directors..

Stewart said Boyle and Maier's move had come out of the blue. "We think it's an attempt to move the discussion from the company and its relatively flat earnings, poor history and its future to issues of board composition."