Outgoing Vector chairman Michael Stiassny has taken a parting shot at the C&R controlled Entrust.
Outgoing Vector chairman Michael Stiassny has taken a parting shot at the C&R controlled Entrust.
Outgoing Vector chairman Michael Stiassny has taken a parting shot, warning thousands of Aucklanders' annual payout could be cut because of internal politics.
Stiassny believes the publicly-elected trust that controls 75 per cent of the $6 billion listed energy giant is possibly planning a selldown of shares that would reduce the payout of about $350 for 320,000 households.
The next payout is due in late September.
"There are a lot of people in Auckland who rely or enjoy that dividend and I think it is possible that there are people or things in play here that are putting at risk the shareholding that the trust currently holds," Stiassny told the Herald.
The chairman of Entrust, William Cairns, said a selldown of shares was absolutely nonsense and the right-leaning Communities and Residents ticket that holds all five seats on the trust would make a commitment not to sell any shares at October's trust elections.
"It is categorically not on the agenda. We are not selling down, full stop," Cairns said.
Stiassny said he vehemently opposed a selldown because the proceeds would go to the long-term beneficiary of the trust, which is Auckland Council, and beneficiaries would get a reduced payout for the next 60 years.
Vector has lit up the Auckland Harbour Bridge. Now the chairman and trust that control the listed company are creating colourful headlines. Photo / Nick Reed
The salvo from Stiassny - one of New Zealand's leading corporate directors - follows his effective dumping by the trustees, who withdrew their support for him in May.
The former insolvency specialist is chairman of Ngati Whatua Orakei Whai Rawa Ltd, Tower Ltd, the New Zealand Transport Agency, and a former president of the Institute of Directors.
Stiassny said in May he would not seek re-election at the annual shareholders meeting after losing the support of the company's largest shareholder.
Not satisfied with this, the trust held a secret meeting on Wednesday where it is understood they passed a vote of no confidence in Stiassny, who has been on the board since 2002.
Entrust chairman William Cairns.
Cairns refused to comment on the vote of no confidence and another resolution at the meeting to replace trustee James Carmichael on the board with another trustee Michael Buczkowski.
Stiassny accused the Entrust trustees of causing "significant instability" by replacing one of their board directors with another trustee only weeks out from new elections for the trust.
It would be sensible to make changes to the board, which includes two members of the trust, once the election results are known in October, he said.
Carmichael, a C&R Entrust trustee since 2006 and Vector board member since 2008, has also hit out at the other trustees after being de-selected as a candidate for this year's elections.
"I have been dumped by my old buddies," said Carmichael.
"I'm extremely disappointed. I considered my allegiance to C&R had been extremely strong and worked extremely hard as a trustee and was committed to the ownership model and committed to the company.
"It was only 12 months ago that I had unanimous support of all the trustees in my role as a director of Vector. That has disappeared overnight," Carmichael said.
He believed his axing was done for political purposes, saying the behaviour of his former allies did not appear to have any rationality, apart from some agenda.
"I'm deeply concerns about the professionalism and the ethics of the trust in terms of how they have treated the chairman (Stiassny)," Carmichael said.
James Carmichael, right, has been deselected and dumped off the board of Vector
Cairns said Stiassny and Carmichael were engaging in mischief-making.
He claimed Carmichael had been very bitter since failing to be reselected as a C&R candidate.
Cairns said it was decided to have a bit of a refresh around the board table and it was not done to coincide with the political cycle.
Buczkowski was extremely well qualified as an electrical engineer, Cairns said.
Asked what would happen if Buczkowski was not re-elected, Cairns said "we will have to address that matter when it happens".
What is Entrust?
Entrust, formerly the Auckland Energy Consumer Trust, was set up in 1993 to act in the interests of 320,000 households in the former Auckland City Council, Manukau and parts of Franklin which owned 100 per cent of the shares in Vector.
Elections are held every three years for five trustees.
In 2005, the trust sold 24.9 per cent of the shares to raise money to buy gas company NGC Holdings. It retains 75.1 per cent of the shares and pays an annual dividend, typically around $350, to the 320,000 households.
