GREG HUTCHINGS
“I am passionate about Lupus”
Working for
Lupus Capital Shareholders
Dear Shareholder,
As you well know the Lupus directors have been searching for a new Chief Executive Officer to replace the banks interim appointees. Since as early as the AGM on the 29th July 2009, the board stated Lupus was a well managed business under my stewardship with no black holes/turnaround requirement. The prognosis for the business was good . It should have been clear that a new CEO would be in place by Christmas and the turnaround directors to have gone .
You heard the Board at the General Meeting outline their plan for the Company – to manage what was there as best they could . That was the objective. That is not good enough for shareholders in my opinion. The group has always been well managed and it has had clear leadership and vision. The turnaround directors have discovered that and have been open about it to shareholders. But they cannot claim to have achieved what was there already.
The Company has been without true dedicated long term leadership for six months. I have had informal conversations and written to the large shareholders asking for their support for my election to the Board at this time and to put myself forward as CEO. They know my intention so this will not come as a surprise to them
I have met Mr. Pike. He assured me he would act as a compromise non-executive Chairman trying to reconcile all interested parties. He is well capable of a good relationship with the banks given the concerns that have been allowed to circulate in certain quarters that the banks could be less than cooperative under my stewardship. The current relationship with the banks is stable and profitable for the banks.
These are strong t reasons why I would ask you to positively support my appointment to the Board and assume the role of CEO.
I feel I am the best, most qualified, motivated, capable person for the future of Lupus.
1. I have £9 million of personal money invested in Lupus equity – I am aligned hugely with shareholders.
2. The general meeting vote among the general shareholder base has shown that a significant number of shareholders including smaller portfolio managers want me to be appointed.
3. My skills and track record successfully cover the whole spectrum of acquisitions, integrations, operations, financing, media and shareholders.
4. My knowledge of the Lupus businesses all of which I acquired, - and the people - cannot be rivaled by an outside appointment.
5. Having effectively founded Lupus and regularly produced record results I have demonstrated my proven ability at Lupus.
6. All staff know me and I believe will prefer and want to work in a Group overseen by me
7. No management risk as there would be with someone unproven.
8. I have been a successful, international FTSE 100 CEO (£5 billion sales / £500 million profits) for many years and thus easily able to run and develop a small business such as Lupus.
9. I have had building products sector experience in the US, UK and Internationally for over 20 years.
10. I am available now.
11. A third CEO in 6 months would be disruptive
When you add my inside knowledge, passion, and commitment for the Company and its people it should be a compelling appointment.
I would happy to work with the non-executive Chairman Jamie Pike and the new non-executive directors to build and develop Lupus. Conbining together is a powerful story which will be good for the business as well as all internal and external stakeholders. I certainly think that the current low level of morale in the company will be positively transformed with my appointment.
If Mr. Pike and the two new non-executive directors are a strong, active and involved board then they should welcome having me reporting to them as a resolute CEO with the vision, which is currently lacking, to accelerate value and growth.
In relation to other candidates, I would hope my qualifications are much greater. Externally most of the shareholders are originally invested in Lupus because of me, my time at Lupus and my track record so would be severely disappointed with any other CEO. I still own 11.3% of the company and would continue to scrutinize each decision a CEO makes and their performance in detail as well as having the ability to requisition General Meetings.
In order to allow shareholders the opportunity to influence the future management, direction and success of Lupus I have requisitioned a General Meeting. This is to vote for my appointment as a board member and CEO as well as general requests to clarify a number of corporate governance issues which continues a trend towards lack of transparency on pay and communication with shareholders since I left.
Lupus can be a great company and I would like to ask for your support to make it so.
Yours sincerely,
Greg Hutchings
Shareholder
Monday, 25 January, 2010
PS.
I would like to hear from you if you have any questions on the action you should take to exercise your rights as a Lupus shareholder. I would welcome any questions, messages of support or comments from shareholders. Please submit your details in the spaces provided below. I will post any questions and my answers if they affect all shareholders. No personal details will be published or given to third parties without your consent.
If you are a Lupus shareholder please give the number of shares that you can vote, with an indication of your support for the Resolutions.
Dear Shareholder,
In order to allow you the opportunity to influence the future management, direction and success of Lupus, I requisitioned a General Meeting to vote for my appointment as CEO as well as to clarify through specific resolutions important issues surrounding the Company’s lack of transparency on pay and communication with shareholders since I left.
The Board at the last General Meeting, summarised their plans for Lupus – to manage what was there as best they could. This seemed to be the limit of their objectives. That is not good enough for shareholders. The group has always been dynamic and well managed and it has had clear leadership and vision. The turnaround directors discovered this and were quick to tell shareholders.
Lupus has recently announced a new CEO – Louis Eperjesi. As a shareholder, like me, you should make enquiries whether he is the right man with the vision, international experience, reputation, track record, financial commitment and skills to develop Lupus. Was this choice made hurriedly to hinder my campaign? There were 3 or 4 candidates interviewed by a number of board members. Ask the Chairman, Jamie Pike, whether all members of the Board, including the turnaround directors, were always certain and convinced, having interviewed Mr. Eperjesi, that he was the right man for this job and not just a compromise candidate.
Shareholders should be dismayed that Mr. Pike has dismissed my candidacy.
· Research would show that I have always been a team player in both my business and sporting endeavours. I am able to either give or take directions.
· Institutional fund managers get varied, changing mandates from their investors and their shareholdings are often transient. Other shareholders, who invested their own money, savings and pensions, as I did, are much longer term. Most shareholders originally invested in Lupus because of me, my time and long term expectations for the Company and my track record.
· If Mr. Pike and the non-executive directors are a strong, active and involved board they should welcome me as a resolute, determined CEO reporting to them. Instead, the new independent directors have not even met me enabling them to make comparisons.
This is what I offer to shareholders:
1. I have £9m. of personal money invested in Lupus.
2. My experience successfully embraces acquisitions, integrations, operations, financing, media and shareholders.
3. My knowledge of, and track record with, the Lupus businesses, all of which I acquired, and the people, cannot be rivalled.
4. I effectively founded Lupus and regularly produced record results for shareholders showing proven ability at Lupus.
5. I have a relationship with staff and key management, all of whom I believe would prefer and want to work in a Group operated under my guidance.
6. There is none of the management risk associated with someone unproven.
7. I have been a successful, international FTSE 100 CEO (£5b.sales / £500 m. profits) for many years and thus easily able to run and develop a small business such as Lupus.
8. I have had building products sector experience in the US, UK and Internationally for over 20 years.
9. A third CEO in 8 months is disruptive.
I will further align with shareholders by working for £1 p.a. until the share price reaches 90p. Add my inside knowledge, passion and commitment for the Company and its people, it should be a compelling appointment to consider and make work for shareholders and stakeholders. My management team as well as most shareholders signed up for my vision for the group and the way we ran Lupus. I still own 11.3% of the Company and will scrutinize each decision the Board makes and their performance in detail as well as having the ability to requisition General Meetings.
Please remember that my stewardship of Lupus was praised by the old board and turnaround managers. Shareholders, however, are still paying a heavy price for the decisions made by the banking syndicate headed by the Bank of Scotland. They have cost your Company dearly both financially and in the loss of talented and motivated management. This is precisely what I stood up to for the sake of shareholders. The Bank of Scotland however was adamant that their turnaround men be appointed as CEO and CFO.
Shareholders know there was nothing to turnaround. The costs have been enormous. If ( as was my fear last year) the Company, at the behest of the banks, has indeed gone ahead to switch dollar debt into pounds to cover the banks’ risk, I would estimate that the total cost to shareholders so far has been over £15m. This would include more than £7.5m initially, followed by interim management’s daily rates and fixed fees, advisors such as stockbrokers, PR consultants, lawyers, extra non-profit-making paperwork and staff, ballooned head office costs, plus no doubt, fees to investigate an attempted unnecessary rights issue. Shareholders should be very concerned about these outgoings continuing. For £15m, BoS merely engineered a bank compliant board and lost all on-going continuity of successful Board level operating directors.
No matter what some large fund managers decide, I would ask you to continue our campaign and vote for all the resolutions. So far we have achieved much: The admission by turnaround men that Lupus was well managed with no black holes, the revelation of their costs, avoiding a dilutive unnecessary rights issue, increasing public awareness of directors’ actions, mobilizing over 80% GM voting, greater transparency, and a complete change of board.
Lupus can be a great company. The requisition questions I am asking need to be addressed and not glossed over. I do not seek to remove any directors, but only that your Company should be run efficiently and effectively, with good governance and transparency and with a vision for the future.
For further information or voting assistance please contact me at www.gregegm.com, on greg@gregegm.com or write to me at Greg Hutchings, The Boathouse, Crabtree Lane, London SW6 6TY or leave a message on 07706108007.
Yours sincerely,
Greg Hutchings