Shareholder row brews at Topps Tiles after ‘costly blunders’

The biggest shareholder in Leicester-based Topps Tiles, MS Galleon, has called for an overhaul of senior management at the firm, after what it called a series of “costly blunders”.

Piotr Lipko, the managing director at MS Galleon, wrote to Topps’ chair Paul Forman last week, according to reports in The Times.

Lipko slammed Topps’ recent acquisition of CTD Tiles as “unequivocally irrational” and “highly detrimental” to the interest of the company.

MS Galleon, which owns a 29.9% stake in Topps Tiles, said the Leicester firm has overpaid for CTD Tiles and hadn’t done proper due diligence.

Last week, Topps revealed it had slumped to a hefty full-year loss on the back of a shrinking market.

The retail giant made a deficit of £16.2m for the 52 weeks to 28 September – down from a profit of £6.8m in 2023. The firm put this down to a £19.4m non-cash impairment – primarily of right-of-use assets, and £3.1m expense relating to purchase of remaining Pro Tiler shares.

Revenues also fell by 4.1% to £251.8m over the period.

Responding to the Times report, Forman said: “We engage with all our larger shareholders on a regular basis and listen closely to their views. Our strategy was reviewed in April and presented to shareholders in May, with further updates given last week. Further expansion of our digital capabilities is at the heart of many of these growth initiatives. Our latest results show that we continue to take market share, consistently outperforming the wider tile market despite very challenging trading conditions. We believe this demonstrates the effectiveness of our strategy, which has the full support of the board.”

In January of last year, Forman’s predecessor, Darren Shapland, survived a vote, orchestrated by MS Galleon, to oust him at the firm’s AGM.

Shapland was voted back in after winning the backing of almost 62% of Topps’ shareholders.

MS Galleon failed to install both Lidia Wolfinger and Michal Bartusiak as directors.