WPP Scangroup founder and former CEO Bharat Thakrar is seeking the support of fellow minority shareholders to oust the firm’s board at the annual general meeting (AGM) scheduled for Monday in a rare show of investor activism.
Mr Thakrar on Monday kicked off a campaign calling on the minority shareholders to register and vote for the removal of the current board members and back a new team of directors at the June 8 AGM.
The minority shareholders, with a combined 13.59 percent stake, including MR Thakrar’s, forced the firm to include the ouster and election of new directors as part of the AGM, citing a string of poor financial performance.
The former CEO is lobbying the other minority shareholders to register and cast their vote against a board backed by WPP, escalating the fight between the founder and the UK firm, which first bought a stake in the firm in 2008 and now has a 56 percent stake.
Globally, activist investors have mounted a record number of attacks on companies as disgruntled shareholders sought to oust directors or force the sales of businesses whose share prices had languished.
Deepening losses
Kenya has witnessed fewer instances of activism, with cases of minority investors pushing publicly for change they believe will shore up profits and share prices being rare.
“After years of deepening losses and eroding shareholder value, this is the moment for the voice of minority shareholders to be heard…Every vote counts, and the outcome will be decided by those who show up,” said Mr Thakrar in a statement as he launched a social media campaign on the ouster bid.
“This AGM is an opportunity to hold the current board accountable for the company’s performance and to support a credible path to recovery. A strong turnout from minority shareholders sends an unmistakable message. Please register, attend and vote. Your vote will matter.”
The AGM has listed the minority shareholders’ push under special business, coming after the ordinary business in which current board members—including Richard Omwela, Patricia Kiwanuka, Kagiso Musi, Nick Douglas and Manuel Segimon—have offered themselves for re-election.
The minority shareholders want the removal of the current board led by chairman Omwela.
Other board members whom the minority owners want out are Beverly Spencer Obatoyinbo, Peter Kimurwa, Patricia Kiwanuka, Patricia Helene Nuytemans, Jonathan Eggar, Shahid Sadiq and Tebogo Skwambane.
New directors
Mr Thakrar’s camp wants to replace the board with new directors, including the former CEO, Carl Ogola, Kunal Kamlesh Bid, Rishab Thakrar and Andrew White, who was the executive creative director of Scangroup Africa until 2013
Mr White is known for ad slogans like “Mimi ni Member for Equity Bank, “Let’s talk about Trust” for Trust condoms, “Milele” for Tusker and “Smooth all the way” for Embassy cigarettes.
The minority shareholders say the firm’s share price at the Nairobi bourse has declined 62 percent to Sh2.2 from Sh5.94 when Mr Thakrar was removed, resulting in material erosion of shareholders’ value, alongside loss of major clients and decline in profitability.
In the letter, the minority shareholders say the Scangroup has incurred aggregate trading losses of about Sh3.3 billion between 2021 and 2025, when the net loss widened by 41 percent to Sh713.7 million from a Sh506.7 million loss booked in the previous year. Its revenues have dipped to Sh2 billion from Sh7 billion in 2021.
They are also questioning the terms of the Sh1.2 billion that Scangroup has lent to its parent firm, WPP, with an interest of five percent, arguing that the rate is lower than average deposits and lending rates at 6.86 percent and 16.85 percent, respectively.
The shareholders say the five-year period has seen the company lose major clients, including KCB, Equity, NCBA and Airtel Africa.
