Embattled transport firm FirstGroup PLC (LON:FGP) has said it will hold a general meeting at 2pm on 25 June where shareholders will decide the fate of six of its directors including its chief executive Matthew Gregory and chairman Wolfhart Hauser.
The meeting has been requisitioned by Coast Capital, an activist investor that holds nearly 10% of the FTSE 250 group, in an effort to oust the six directors and replace them with seven of its own nominees to reverse what they say is value destruction by an unqualified board.
READ: Activist investor Coast Capital slams “half baked” FirstGroup breakup plan
The New York-based hedge fund has been pushing for a breakup of the group since mid-May, a move that FirstGroup conceded to on Monday when it unveiled plans to sell off its Greyhound arm and instead focus on its other US bus businesses First Student and First Transit.
However, that same day Coast criticised the plans as being “half-baked”, adding that they had doubts over the current board’s ability to run a North America-focused transport business as none of its members had any relevant experience in the region.
Announcing the meeting, FirstGroup said Coast's proposals were "inconsistent", demonstrated a lack of understanding of the company and the transport sector, and would leave the firm with higher debts if implemented.
The company added that it believed its strategy was the right course of action and that the current management were the best team to navigate what it said were the "complex issues" around its restructuring.
In an emailed response, the activist shareholder said: “Coast Capital is delighted that FirstGroup has finally confirmed the date of the EGM which Coast has requisitioned.
"Coast strongly disagrees with the claims made by the board of FirstGroup and will respond to these over the coming days.”
In late-afternoon trading on Tuesday, FirstGroup shares were up 0.3% at 110.2p.
-- Adds Coast Capital response comment --