Good morning!


Lakehouse (LON:LAKE)

Share price: 43.88p
No. shares: 157.5m
Market cap: £69.1m

(at the time of writing, I hold a long position in this share)

I reported yesterday on Board changes at this support services group, with the CEO stepping down, and the Chairman, Stuart Black, becoming the new CEO.

EGM Requisition - another announcement today states that the founder (and still 15.5% shareholder, Stuart Rawlings), supported by respected fund manager Slater Investments (holding 6.0% of the company) has served a notice to the company requisitioning a general meeting. Under the Companies Act 2006, and shareholder or group of shareholders holding at least 5% of the shares in issue, can requisition a meeting of shareholders.

The purpose of the meeting is as follows;

The Requisition proposes resolutions that the three current Non-executive Directors of the Company be removed from the Board of Directors of the Company, to be replaced by Steve Rawlings, Ric Piper and Robert Legget. In addition, a further resolution is proposed to remove from office any person appointed by the Directors of the Company as an additional director pursuant to the Company's Articles of Association between the date of the Requisition and the conclusion of the requisitioned general meeting. As a consequence, if such resolutions are passed, all of the Company's Non-executive Directors will have been proposed by the Requisitionists.

This is quite a strange situation. Since Non-Execs don't have any real power, they're normally just asked to resign, and they comply. I can't recall seeing EGM requisitions before to oust Non-Execs. It's normally the case that someone wants to take control of the Board by ousting the Execs, but that's not the case here.

My opinion - this suggests to me some sort of disagreement between major shareholders, and the new CEO (former Chairman), so shareholders are flexing their muscles here by the looks of it. Clearly the two major shareholders concerned, who together own 21.5% of the company, don't rate the current Non-Execs, and want them out.

I put a call in to the CEO this morning, but got no answer, so instead spoke to an adviser. I was advised that the company will put out an announcement commenting on the EGM requisition, so we should keep our eyes peeled for that, which should hopefully explain the situation.

Personally I think that the founder, and 15.5% shareholder, wanting to come back as a…

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