We can get some extra votes. Pity they are worthless and scumbags are in charge of governance.
Comments on Campari's shareholder loyalty votes
We have held Campari shares for well over five years - and operationally it has been hard to fault the company.
Management have taken Aperol from niche mildly sweetened bitters product in Venice to an instagram worthy global phenomenon. I sat on a bench in a white-washed alley of some Greek Island looking at the beautiful people photographing themselves drinking from bulbous glasses of bright-orange and alcoholic candy-water and marvelling at just how fabulous the company had been at marketing.
The management (and the controlling shareholders) have just introduced a shareholder loyalty plan giving more votes to shareholders who have held for a long time. In particular, the Special Voting Mechanism entitles shareholders registered in the loyalty register, who have completed an uninterrupted holding period of 5 years, to cast 5 votes for each ordinary Campari share held.
Let’s be blunt about what this does. It allows the dominant shareholder to sell half their shares (or more) without losing control of the company. It poisons the market for corporate governance.
Normally shareholders have a mechanism to protect themselves if management are incompetent or venal or simply just line their pockets at shareholder expense. They can band together and fire them.
Or maybe an activist can come and buy up the shares and fire them and profit.
That can’t happen at Campari anymore. And as the management are clearly not incompetent this makes me think they plan to be venal.
I used to have respect for this management team. I don’t any more. They are scum.
And if you meet them on the Aperol-soaked social circuit you should shun them. They deserve it.
John
PS. We will be applying for our loyalty votes. But it won’t help. We can’t vote these scumbags out any more and that is the point of the whole exercise.
PPS. There are special classes of shares with 20 votes. It is even worse than this note outlines. Truly awful.