Over Fifty Group (OFG) has hit back at its company director John McBain for publically blasting the group's performance, stating they have lost all confidence in him.
The listed financial services group released a counter letter to shareholders late last week after McBain sent out his own letter outlining, among other things, the alleged significant inefficiencies of OFG's board.
"Mr McBain now wants to replace four of the five independent directors with four new directors of his choosing," OFG's latest letter to shareholders said.
"We consider this proposal would effectively deliver control of the company to Mr McBain and his nominees and would in our opinion, jeopardise the security and stability of the company."
In support of the current director's argument for shareholders to reject McBain's move to replace directors, OFG stated that the current board had: "overseen growth in share value in excess of 140 per cent on the $1.00 issue price in 2002, and has consistently delivered strong dividend income to shareholders".
"The current directors lost all confidence in Mr McBain when he recently commenced legal proceedings against the company in the Federal Court, where he unsuccessfully attempted to halt an important strategic review being undertaken by the company," the letter said.
OFG's letter also states the company's strategic review has been concluded, with its reviewer, Macquarie Bank, recommending that a merger of the company would be the course most likely to maximise shareholder value.
Interestingly, the name of the group OFG is considering merging with was not mentioned, despite McBain's recent legal proceedings over suggestions OFG did not disclose information regarding its strategic review.
Last week McBain blasted the performance of his fellow directors, claiming their management of the company is full of significant inefficiencies.
In a letter to shareholders, OFG executive director John McBain also claimed the underperformance of the company had been overlooked with its current board members allegedly more interested in selling the group.
As of last week there were about 30 potential buyers for OFG, McBain's letter said.
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