5 questions asked at 2024 AFG hybrid AGM
October 18, 2024
Below is the text of the 5 written questions submitted at the 40 minute 2024 AFG hybrid AGM held in Perth on October 18, plus a summary of the answers and some video grabs via Twitter. The proxies were disclosed early, including with shareholder voting data, which was removed from the final poll results.
Q1. Do any of the 5 main proxy advisers - ACSI, Ownership Matters, Glass Lewis, ISS and ASA - cover us and which of them recommended a vote in favour of the rem report? Best practice is now to disclose the poll results by including for and against votes by both shares and shareholders, like with a scheme of arrangement. This provides a better gauge of retail shareholder sentiment on all resolutions and insight into the chronically low retail shareholder participation rate. Are you prepared to do this, given many others now do?
Answer: All 3 major advisers, ACSI, Glass Lewis and ISS, cover the company and recommended in favour. Was at cross-purposes on voting disclosure which they'd already done with the proxies but then removed from the final poll results. Watch video of exchange via Twitter.
Q2. Thank you for bucking the normal trend with Perth-based companies and ticking all the key boxes with today's AGM. You've offered a full hybrid with video, disclosed the proxies early with the formals to the ASX, received no material protest votes & not waited until late November to hold the AGM. Whose idea was it to be so different from other Perth-based companies like Fortescue, BCI, Bellevue Gold, Made Group, Peet & many miners which force east coast shareholders to fly into the world's most isolated city to participate?
Answer: The chair Greg Medcraft took this one as a comment.
Q3. In June 2020 AFG did a $60m capital raising comprising a $15m placement at a 17.3% discount of $1.15 followed by a non-renounceable 1-for-5.5 at $1.15 with certain insiders partially under-writing the retail offer. Retail couldn't apply for overs. The retail offer was only 78% subscribed with $10.1m raised & an additional $2.96m coming from the under-writers. Does chair Greg Medcraft agree this was badly structured, diluting retail without compensation. Will future raisings be fairly structured & don't you owe retail an SPP?
Answer: The chair fobbed this one saying he was working overseas and not on the board at the time whilst the CEO just waffled about difficult times during COVID. The key problem was banning retail from applying for additional shares and letting insiders pick up the shortfall at a discount. Watch video of question being asked and separate video of answer via Twitter.
Q4. What has REA getting into the mortgage broking industry with the $300m takeover of Mortgage Choice down to the market. Don't these monopolists have an unfair advantage? How important is REA for our business and does REA prioritise promotion of their own brokers?
Answer: The CEO gave a considered response explaining the different industry models and then Greg Medcraft added a little gem at the end pointing out that brokers have a duty to client whereas banks don't. Watch video of exchange via Twitter.
Q5. As the former chair of ASIC and our chair, does Greg Medcraft really believe we need to do this proportional takeovers update? I own tidy holdings in around 400 companies and have never received a proportional takeover but have voted on hundreds of these resolutions. What is the point? Does anyone ever launch proportional takeovers and what is wrong with it if they did?
Answer: Not asked.
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