Shareholders throw lifeline to Patisserie Valerie in stormy emergency meeting
Angry shareholders of Patisserie Valerie have backed a rescue plan for the struggling business at an emergency meeting which saw them demand answers from chairman Luke Johnson and his fellow directors.
At the meeting this morning, more than 99% of shareholders backed a plan to issue £15m of new shares to recapitalise the company but accused Johnson of “holding a gun” to their heads over the rescue deal, saying they feel cheated that new investors are getting a cut-price deal on a share in the business.
It is three weeks since the Birmingham-based business suspended trading of its shares on the Alternative Investment Market and launched an investigation into suspected accounting irregularities.
Despite their support for the rescue package this morning, investors continue to demand answers as to how a £40m black hole appeared in the company’s accounts, and the discovery of two “secret” company bank overdrafts.
The chain was saved from collapse earlier this month after Johnson joined forces with investors to plug the firm with cash.
Johnson made £20m available in emergency funding to prevent the company’s collapse, keeping its 200 stores open while securing 2,800 jobs. Shareholders, including fund managers Schroders, Invesco Perpetual and Miton, bought in at 50p-per-share to provide £15.7m of funding.
