8 questions lodged at 2025 SG Fleet virtual scheme meeting
April 8, 2025
Below is the text of the 8 written questions submitted at the 30 minute SG Fleet virtual scheme meeting held at 3pm on April 8, 2025 via the Lumi platform, plus a summary of the answers and some video grabs via Twitter. All questions were read in full but the audio was poor and acting 81yo chair Edwin Jankelowitz left it to management to answer them all. No proxy disclosure in these formal addresses. See notice of meeting and voting results. Market cap was $1.18 billion on EGM day and no other shareholder asked any questions. Also, see these 7 questions from the 2024 virtual AGM where was also the only shareholder asking questions.
Q1. Why aren't the regular 2,700 retail shareholders in SG Fleet being offered the same opportunity to roll over into the PEP bid vehicle as will be afforded to certain management personnel, if they vote in favour at their following special meeting at 4pm today? Surely all shareholders should be treated equally. Was consideration given to allowing institutional shareholders to roll into the bid vehicle? Is there someone from PEP on the call today who could help answer this question?
Answer: PEP only offered it to the management team, who were voting on the proposal at a separate 4pm virtual meeting. Watch video of exchange via Twitter.
Q2. The S&P500 briefly went into correction territory last night. What were the material adverse clauses in our sale agreement which would have allowed PEP to walk away and was the chair nervously watching the recent tariff-related wild market plunges with this in mind? Does today's vote end the possibility of an MAC event or if Wall Street tumbled 30% before the scheduled April 15 NSW Supreme Court scheme approval hearing, could PEP still walk away without completing the takeover? In other words, when does this deal become completely unconditional?
Answer: The only MAC clauses relate to the SG Fleet balance sheet and these expire at 8am on the day of the final court hearing, so shareholders can relax, the full $3.50 a share is definitely coming. Watch video of exchange via Twitter.
Q3. Why are duly lodged proxy votes automatically rescinded just because a shareholder has logged onto the Lumi system to participate in today's scheme meeting? Is this even legal and is Lumi working to fix this flaw in their online meeting and voting system? If a shareholder has lawfully voted by proxy, what gives you the right to rescind the vote? Surely you've got a record of all proxy votes and can just re-instate the system-voided votes at the end of the meeting, without requiring the shareholder to do this during the meeting?
Answer: An unidentified member of the management said they would raise this with Lumi which had assured SG Fleet this had happened at many other meetings. Not good enough. Watch video of exchange via Twitter.
Q4. Proxy voting closed at 3pm on Sunday. Why did you allow nearly two full days of ASX trading without disclosing the market sensitive proxy position to the ASX? Did you get legal advice on this? Sigma Healthcare suspended their stock for the whole day on January 29 ahead of the 6pm Chemist Warehouse scheme meeting for their takeover arrangement. Did we consider doing the same and suspending trade today and what is the proxy position on the scheme? You should have disclosed it with the formal addresses or at least disclose it now before question time has finished?
Answer: Someone said they'd had legal advise not to suspend the stock and pointed out that the market knew the majority shareholder would be voting in favour. Yes, but what if there was a retail shareholder revolt? Watch video of exchange via Twitter.
Q5. How many shareholders were eligible to vote on today's takeover and did we send paper voting forms with a reply paid envelope to those shareholders which hadn't provided an email address? What sort of solicitation campaign did we run to encourage our circa 2,700 retail shareholders to participate by voting on today's deal and how many of them did choose to vote by proxy before the 3pm voting deadline on Sunday afternoon?
Answer: Someone said paper ballots and reply paid envelopes had been sent where no email contact was available but the shareholder metric data wasn't even included in the proxy disclosure flashed on the screen. Watch video of exchange via Twitter.
Q6. Why isn't independent chair Andrew Reitzer chairing this meeting and have PEP had any discussions or entered into any arrangements with any of the existing non-executive directors to have an ongoing role with the business after the takeover completes? Also, have they agreed to any additional exertion payments to the non executive directors given all the extra work that is required to complete a large takeover transaction like this one. If not, why not? If so, how much extra are the directors being paid on top of their existing pro-rata board fees?
Answer: Someone said he was out of action overseas and then amidst the poor audio quality, it sounded like no exertion payments will be paid to the directors. Watch video of exchange via Twitter.
Q7. Given the interesting discussions at today's scheme meeting and the fact that more than 2,600 of our retail shareholders did not attend live, could the chair undertake to make an archived copy of the webcast available on the company's website, at least until the transaction completes? It was disappointing that the company never published a full archive of the webcast of last year's interesting AGM discussion. Why did you refuse to do this, limiting shareholder access to what was an interesting AGM debate?
Answer: Audio was so poor it was hard to discern the answer but assume they won't do it, as usual. Watch video of exchange via Twitter.
Q8. Australia is currently in the midst of an unprecedented deluge of takeovers that has contributed to listed entities on the ASX dropping in 25 of the past 26 months for a net reduction since January 2023 of 202 listed entities or 8.8% to a 15 year low of 2,092. There were a record 29 major takeovers above $200m completed in calendar 2024 and the ASX is losing many long standing names, including SG Fleet after 10 successful years as a public company. There is a clear mis-pricing between public markets and private markets. Why didn't public market investors value ASX listed companies like ours more highly and does the acting chair agree that this takeover is adding to an emerging problem and this is hollowing out of the ASX is a real worry for the nation and the overall health of our public capital markets.
Answer: Someone decided to take this as a comment. Surely the chair or CEO could have uttered some form of lament about this public company reaching the end of the line, albeit in a rare example of a public shareholders doing well buying into a company which was floated by a different private equity firm. Watch video of exchange via Twitter.
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