E-Malt.com News article: World: SABMiller shareholders advised to vote against election of Graham Mackay into a dual role of executive chairman

Shareholders of brewing giant SABMiller PLC should vote against the election of Graham Mackay into a dual role of executive chairman later this month, the U.K.-based independent shareholder advisory body PIRC said on July, 17 in a report.

The body said even as Mr. Mackay is to become non-executive chairman in July 2013 when Alan Clark, the group's current European chief, is appointed CEO, there are fears of a "concentration of power" at the head of the company, Dow Jones Newswires reported.

According to an annual report last month, SABMiller said the appointment of Mr. Mackay, CEO since 1999, "in the best interests" of SABMiller and its shareholders, despite U.K. corporate governance code recommendations that a CEO shouldn't become chairman or hold the combined role.

The maker of Miller Lite and Peroni Nastro Azzuro, which holds its annual shareholders’ meeting July 26, said the group has gained from the highly regarded long-standing experience of Mr. Mackay and of current Chairman Meyer Kahn.

A spokesman for SABMiller said: "Based on conversations we have had with investors, we are confident that our recently announced management changes enjoy the support of the overwhelming majority."

Mr. Mackay was paid 5.9 million pounds ($9.2 million) before share gains for fiscal 2012, up from GBP5.6 million in the previous year, the brewer said last month. The remuneration figure includes base salary, bonuses and benefits, but excludes stock options.

On July, 17, PIRC, which also said shareholders shouldn't back the election of the group's non-executive directors due to a lack of independence, added that investors should oppose the remuneration report. It said the company's share scheme lacks transparency and doesn't sufficiently encourage earnings outperformance.

At the end of May, the world's No. 2 brewer by revenue, after Anheuser-Busch InBev NV, posted a 75% jump in net profit to $4.22 billion for the fiscal year ended March 31, after an exceptional gain of $1.03 billion, most of which came from the disposal of SABMiller's Russian and Ukrainian businesses last October as part of an alliance with Turkish peer Anadolu Efes SA. In addition, the year-earlier period was hit by $436 million charge that included restructuring costs.

Earnings before interest, taxes and amortization - a closely watched gauge of operating performance - rose 12% to $5.63 billion.

The London-based brewing giant, which has a secondary listing in Johannesburg, is benefiting from rising demand for premium beer across Latin America, Asia and Africa, where expanding adult populations and rising incomes are driving consumption.


18 July, 2012