Share­hold­ers call for cull of board at Patis­serie Va­lerie

The Sunday Telegraph - Money & Business - - Business - By Oliver Gill

PATIS­SERIE VA­LERIE will face de­mands for “whole­sale” board­room changes and ques­tions over “col­lu­sion” be­tween ex­ec­u­tives at a crunch share­holder meet­ing on Fri­day.

Share­hold­ers are due to vote on a fundrais­ing pack­age needed to res­cue the busi­ness, af­ter a £40m black hole was un­cov­ered in its ac­counts. A con­di­tional plac­ing of 20 mil­lion shares re­quires the ap­proval of 75pc of in­vestors.

While only one mo­tion has been tabled, share­hold­ers will be ex­pect­ing an­swers af­ter be­ing fur­nished with only lim­ited de­tails on a cri­sis that has taken the Aim-quoted com­pany to the brink. “What has come out since looks grub­bier and grub­bier,” one of Patis­serie Va­lerie’s lead­ing in­sti­tu­tional in­vestors told The Sun­day Tele­graph.

“We would be sur­prised if the CEO stays. Some­one is go­ing to have to fall on their sword,” the in­vestor said. “Ul­ti­mately they need to put three new peo­ple in place. A new chair­man, a new CEO and a new CFO. Our view is there needs to be whole­sale change or man­age­ment or board in­de­pen­dence has to be strength­ened, so we have re­as­sur­ance this will not hap­pen again.”

Patis­serie Va­lerie, which had seem­ingly avoided a broader high street malaise, shocked staff, cus­tomers and in­vestors ear­lier this month by re­veal­ing “sig­nif­i­cant, po­ten­tially fraud­u­lent ac­count­ing ir­reg­u­lar­i­ties”. Ma­jor­ity share­holder and ex­ec­u­tive chair­man Luke John­son, two-thirds of whose vast wealth was tied up in the com­pany, plugged a cash hole days later, com­mit­ting £20m of se­cured loans.

With shares sus­pended, the fin­ger has been pointed at long-term fi­nance chief Chris Marsh. On Fri­day he quit hav­ing ini­tially been tem­po­rar­ily re­moved from of­fice. Po­lice have also ar­rested and ques­tioned Mr Marsh.

A wind­ing-up pe­ti­tion by HM Rev­enue & Cus­toms was last week with­drawn, re­mov­ing an im­me­di­ate threat that would have oth­er­wise seen liq­ui­da­tion pro­ceed­ings started within days. But fur­ther ques­tions were raised about Patis­serie Va­lerie’s cor­po­rate gov­er­nance af­ter it ad­mit­ted to hav­ing handed out three times as many share op­tions to Mr Marsh and chief ex­ec­u­tive Paul May than had been dis­closed.

Ex­ec­u­tive chair­man Luke John­son has plugged the cash hole at the com­pany by com­mit­ting £20m of se­cured loans

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