Category: Company News / Hospitality / Gambling

Tabcorp investor backlash over pay and Tatts takeover

Tuesday, 25 Oct 2016 12:37:09 | Sue Lannin

Gambling giant Tabcorp is the latest big company to be hit by an investor backlash over executive pay during the annual general meeting season.

Just over three-quarters of proxy votes cast at today's AGM in Sydney supported the company's plans to increase the pay packet of managing director David Attenborough and other executives, but about 22 per cent of votes were against the motion, falling just short of the 25 per cent needed for a "first strike" motion against the company.

Mr Attenborough is in line for a pay rise from $2.7 million to $3.1 million, despite the gaming giant's profit plunging by half in 2016.

The Australian Shareholders' Association (ASA) and several corporate governance advisers opposed Tabcorp's planned increases in executive pay.

Tabcorp is also facing stiff legal bills from court cases including allegations from Australian financial crime regulator, AUSTRAC, alleging that it broke anti money laundering laws by failing to report more than 200 suspicious transactions.

The case will start in the Federal Court in June next year.

The company is also facing an Australian Federal Police investigation into alleged bribery in Cambodia in 2009, which led to its former managing director Elmer Funke Kuppe resigning from his role running the ASX earlier this year.

The ASA also called on Tabcorp to give shareholders a vote on the planned $11.3 billion merger with rival, Tatts Group.

The demand was dismissed by Tabcorp chairman, Paula Dwyer, during the AGM.

Current laws do not require shareholder approval for a reverse takeover, where a bidder buys a larger company and offers its shares as part of the purchase price.

Only investors in the larger firm have the right to approve or scupper the deal.

A combined Tabcorp - Tatts Group would control more than 90 per cent of Australia's totalisator betting, owning TAB outlets and lotteries including Tatts and NSW Lotteries.

The deal needs the approval of the competition regulator, the Australian Competition and Consumer Commission.



 

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