Compass Group - AGM 04 February 2021
Items 19-20: Disapplication of pre-emption rights on the issue of shares
In May 2020, Compass raised 12.3% of the capital using a ‘cash box’ placing to circumvent the pre-emption requirements detailed in Section 561 of the UK Companies Act 2006. This placement without pre-emptive rights raised gross proceeds of approximately £2 billion (£1,972 million net of issue costs). It exceeded our limit of 10% of the capital and our maximum acceptable discount of 5%. ECGS considers that Compass failed to ensure equal treatment of shareholders and implemented a substantial share issuance without preemptive rights without the authorisation of the general meetings. Therefore, we recommend to oppose all capital increase without preemptive rights which may lead to a further dilution of minority shareholders.
Item 21: Share buyback
The Covid-19 pandemic has had a dramatic and profound impact on Compass. Therefore, ECGS considers that it is not the right moment to proceed to a new share buyback programme especially when the Company cancelled the dividend, raised capital and used the government support.
Compass Group is engaged in providing outsourced food and support services. The five sectors in which Co. operates are: Business & Industry, which provides food for employees during their working day; Healthcare & Seniors, which helps hospitals in the public and private sectors manage and enhance quality of food and support services; Education, which provides dining solutions from kindergarten to college; Sports & Leisure, which provides hospitality and service at sporting and leisure venues, exhibition centers, visitor attractions and events; and Defence, Offshore & Remote, which provides food and support services to companies in the oil and gas and mining and construction industries.
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