Velocity Composites board changes disrupted by founders
Updated : 09:39
Advanced composite material kit supplier Velocity Composites updated the market on its process to reconstitute the board on Monday, after a “disappointing” series of events instigated by the company’s founders.
The AIM-traded firm had announced a process for the re-constitution of its board’s membership at the annual general meeting.
At that time, it was agreed that Mark Mills would step down from the board and his role of executive chairman, while former chief executive officer and board member Jon Bridges was appointed as the interim CEO, while Andrew Hebb was confirmed as continuing as the interim chief financial officer and company secretary.
Neither of the interim roles were members of the board, and both reported directly to the board.
It was also announced at the AGM that the remaining members of the board would appoint independent search consultants to identify a new independent non-executive chairman.
Brian Tenner was appointed as the group's senior independent director to lead that process.
Velocity Composites said the new chairman would, in turn, then be charged with leading the board in identifying a permanent CEO and a permanent CFO to replace the two current interim office holders.
An additional non-executive director was also to be appointed, with independent search consultants to be appointed in early May following a competitive process, and the search for a new chairman to then began.
However, the company said its founders had “made clear” that they did not support the board's process, and instead had proposed an alternative approach to re-constituting the board, which involved their two nominees being appointed to the board before resolving the permanent posts of chairman, CEO and CFO.
The board said it had offered to appoint one of the founder nominees during the search process, but that offer was rejected.
Velocity’s directors said that, while they were disappointed by the turn of events, the board had no choice but to engage with the founders, and was currently in “active discussion” to attempt to resolve matters in the interests of all stakeholders in the short term, and in an orderly fashion.
In light of those discussions, the independent search for a new chairman had been temporarily put on hold.
The board said it hoped to be able to update the market in the very short term, with a resolution that would negate the risk of a disorderly transition if it was prevented from being able to reconstitute itself.
“It is clearly in everyone's best interests to agree an orderly board transition in as short a time frame as possible to allow the group to focus on those business opportunities.
“We hope to update shareholders in the very near term on a successful outcome to the current discussions with the founders.”