Barclays fightback against corporate raider: Activist Ed Bramson has no strategy, says boss Jes Staley
The boss of Barclays has hit back against a New York-based corporate raider bidding to overhaul the British bank.
Chief executive Jes Staley accused Ed Bramson of failing to reveal his strategy for Barclays to the bank’s directors, despite demanding a seat on its board.
Investors also claimed Bramson has not discussed his plans with them.
Battling: Chief executive Jes Staley (right) accused Ed Bramson of failing to reveal his strategy for Barclays to the bank’s directors, despite demanding a seat on its board
One leading shareholder added: ‘He’s identified a number of problems with Barclays but hasn’t come up with any solutions.’
But sources warned that Barclays shareholders could split over Bramson’s plans to win a seat on the board and overhaul the bank – with US investors backing his move while those in the UK swing behind Staley.
Speaking at the World Economic Forum in Davos, Switzerland, Staley accused Bramson of failing to lay out his vision for the bank despite agitating for change.
In an interview with CNBC, Staley said: ‘We’ve had a reasonable engagement with Bramson over the last year, we’ll see him again in March. He really hasn’t laid out his strategy to us, you know. We read the press, and see what they say.’
Bramson claims that his expertise can transform Barclays’ fortunes after years of consternation over its share price. The activist controls 5.51 per cent of Barclays stock through his fund Sherborne Investors. He plans to call a vote of other investors at the bank’s annual meeting in a bid to win a board seat.
But several large UK firms are sceptical. One shareholder who owns stock in both Sherborne and Barclays said they have never even discussed the proposals with Bramson. The investor said they were surprised at the activist’s decision to target Barclays and he may have overplayed his hand.
City insiders believe that most of Barclays’ London-based backers will vote against Bramson’s plans. But it is thought he may be more popular with US investors closer to his New York base.
Six of Barclays’ top ten shareholders are US firms, according to data from Reuters, and American companies in its top 30 control more than 32 per cent of the stock.
However, this includes huge tracker funds run by the likes of BlackRock and Vanguard, where the normal policy is to support a company’s existing management in controversial votes.
If Bramson does force a vote at the Barclays meeting, Sherborne investors who also own Barclays stock will be closely watched.
Most of the firms – which include Aviva Investors, Schroders and Standard Life Aberdeen – have said nothing publicly about whether they back his demand for a boardroom seat. But if he does not get a majority of them onside, it could raise serious questions about governance at his own fund.
Richard Buxton, the boss of Merian Global Investors and backer of both Sherborne and Barclays, said last year Bramson’s timing was bizarre.
Staley is said to have told friends he would quit if ordered to shrink Barclays’ investment bank. And the row could even draw in the Bank of England, which is likely to be deeply concerned about major disruption at Barclays because it is a globally important lender.