Some Tabcorp investors have expressed disappointment with Chairman Paula Dwyer’s decision to reject a vote on its deal with Tatts Group to create an A$11.3 billion company that will control more than 90% of Australia’s totalisator business.
The Australian Shareholders Association (ASA) requested Tabcorp governance to give its shareholders a vote on the merger, the Australian Business Review quoted Dwyer as saying: “There is no requirement under corporations law or ASX listing rules for Tabcorp shareholders to vote on it. Rest assured that in considering the transaction and arriving at the proposal your board has considered very strongly the impact on Tabcorp shareholders and we are absolutely unanimous in our view this represents compelling value for Tabcorp shareholders.”
CEO David Attenborough’s pay packet was increased from A$2.7 million to A$3.1 million by majority vote at the company’s AGM but 22.7% of vote cast were against the increase, only 2.3% short of the 25% needed to suspend the pay rise and a strike against the board.
The ASA and several corporate governance advisers opposed the planned increases in executive pay at Tabcorp.
Investors cited Tabcorp’s 50% profit decline in 2016 as a major reason for voting against the pay increase as well as significant legal fees from court cases.
2016 has been a difficult year for the operator after having anti-money laundering charges levelled at them by the Australian Transaction Reports and Analysis Centre (AUSTRAC) due to failure to report more than 200 suspicious transactions. The case will start in the Federal Court next year.
Tabcorp is also facing an Australian Federal Police investigation into alleged bribery in Cambodia in 2009, which led to its former managing director Elmer Funke Kuppe resigning from his role running the ASX earlier this year.