Argo senses victory after proxy battle
Argo Group International Holdings Ltd said that, based on a preliminary count provided by its proxy solicitor, shareholders have voted to elect all five of its Class III directors to the Argo board.
This comes after a months-long proxy battle between the Bermudian-based insurer and reinsurer and activist shareholders Voce Capital Management LLC.
“We appreciate the strong support from our shareholders,” said Gary Woods, board chairman. “The board and management value the conversations we have had with our shareholders in recent months regarding our strategy, governance, and plans for continuing to create shareholder value. We deeply value their perspectives, and we plan to maintain an active and productive dialogue with our shareholders as we continue to integrate their feedback and execute on our strategy.”
Voce Capital is a San Francisco-based hedge fund that is the beneficial owner of about 5.6 per cent of the shares of Argo. Earlier this year, it attacked what it called a “spendthrift culture” and “inappropriate corporate expenses” at Argo. Argo rejected those claims.
Voce was pushing for the removal of a number of the Argo board, and had put forward its own nominations to replace them. However, it withdrew its nominations a few days before Argo's annual meeting on Friday after two out of five state departments of insurance in the US that had previously given permission for it filing of a definitive proxy statement, reversed their position.
In a statement following the annual meeting, Argo said that, prior to Voce's withdrawal, its nominees and proposals had received limited shareholder support.
Argo said that as of the evening of May 20, Sedgwick Browne, Argo's Class III director targeted for removal by Voce, had received support from shareholders holding over 80 per cent of the submitted proxies. Additionally, almost 80 per cent of the submitted proxies had voted against the removal of Argo's chairman, Gary Woods and more than 80 per cent of the submitted proxies had voted against the removal of the other directors targeted by Voce.
Argo said that, based on preliminary votes, the non-binding advisory resolution on executive compensation received 50.53 per cent of the votes in favour, with 49.47 per cent against.
“We will work with our shareholders to fully understand the concerns that influenced the vote regarding the compensation of our executive officers and are committed to taking the necessary actions to address those concerns,” said Mr Woods. “Our board will carefully consider these results, as well as future shareholder input, in determining executive compensation going forward. We thank our shareholders for their continued feedback and support.”
Final voting tallies from this year's annual meeting are subject to certification by the company's inspector of elections and will be included in the company's report to be filed with the Securities and Exchange Commission once certified.