Mayfield narrowly beats “board spill” attempt, commits to engage with shareholders

Mayfield Childcare, the ASX listed early learning provider, narrowly averted a “board spill” after a series of resolutions proposed by Riversdale Road Shareholding were voted down by shareholders. 

 

The news marked the end of a process that began after Riversdale, unhappy with the way the Board and senior management were operating the business, lodged a shareholder meeting request containing an outline of the reasons for their concern and six resolutions which were to be put to a vote. 

 

The resolutions included three director removal requests that included the current CEO, alongside a further three requests seeking to replace them with three new directors namely; Mr Stephen Kerr, Reginald Foley and Mr Peter Mason all of whom were aligned with Riversdale.

 

Of total votes cast, each resolution failed to pass by around 2 per cent, with 52 per cent of shareholders who participated voting against the resolutions (ie: to retain the current directors) and 48 per cent per cent voting for the resolutions (ie: to remove them). 

 

Although the margins of success were modest, shareholder engagement was particularly high with 59.65 million shares of the total 65.31 million outstanding, (around 91 per cent), included in the vote count. 

 

Mayfield board acknowledges vote outcome in letter to shareholders

 

In the wake of the narrow victory Mayfield’s Board released a letter to shareholders in which it noted that “the results indicate that there is work to do to engage all shareholders in the strategy and direction of the company,” before adding that it takes its responsibilities in this area seriously. 

 

Mayfield then set out its position around three key areas of the business:

 

Growth and scale

 

That the company needs to grow to achieve an optimal scale for a listed business. Growth can be achieved via its existing incubator agreement with Genius Childcare, which is currently being renegotiated and via opportunities presented by external parties such as brokers. In addition, Mayfield confirmed that Canaccord Genuity has been commissioned to assist with the process. 

 

Operational excellence

 

That the company now has a foundational capability to identify, integrate and manage centres at scale and that the overall capability now supports growth. 

 

Governance and risk management 

 

That the company continues to work to improve governance and risk management across the company with commitments to broaden the expertise and experience of the current board as well as advancing the efficacy of internal risk management frameworks so as to ensure alignment and support of strategic objectives and shareholder interests. 

 

The board have signaled they will be engaging with shareholders in the coming weeks to address any concerns they may have and ultimately to work towards aligning the interests of all shareholders with the company. 

 

The next event scheduled for Mayfield is its Annual General Meeting on 30 May 2024.