Call for Vista Group to replace its chairperson and a director

Tuesday, 1 October 2024

Board room ructions at listed cinema software firm Vista Group have spilled over again, with new Australian cornerstone shareholder Potentia calling for a special shareholders meeting to remove the chairperson and another member from the board.

In a statement to the NZX on Tuesday, Vista said it has received a letter from Admetus Capital, the vehicle of Potentia, calling for a meeting to remove Susan Peterson as chairperson and Kirk Senior, a global film industry expert.

Vista Group provides software for cinema management, film distribution and customer analytics to the global film industry, including in the United States, Canada, Mexico, UK, India, China, Australia and New Zealand.

Potentia is an Australian private equity firm that bought an 19.9% stake in Vista in May for just over $92 million. The company paid $2.10 a share for its stake. On Tuesday morning the shares were trading at $2.64, down 1.9% from a peak of $3.14 this year, reached in August.

In a statement to the NZX this morning, Vista said Potentia had nominated two directors ‒ an executive of Potentia, Amitesh Chand, and the current chairperson of MYOB, DroneShield and Macquarie Technology Group, Peter James.

Potentia initially asked Vista on June 26 to appoint three directors, Chand and executive Andrew Gray, and an unnamed independent director.

As part of the evaluation process of Potentia’s proposal, the board consulted the Shareholders Association and the company’s largest institutional shareholders as well as its founding shareholders, together owning more than 50% of the the company.

There was no shareholder support for Potentia’s proposal, but Potentia was invited to propose independent director candidates for inclusion in the board’s succession process, Vista said, while also offering Potentia the chance to “enter into appropriate undertakings in the interests of Vista Group’s other shareholders, so that the board could work with Potentia to the benefit of all shareholders.”

Potentia responded on September 1 with a request that Chand be appointed as a director, and Gray, as Chand’s alternate director.

The board said there was insufficient shareholder support for Potentia’s second proposal and reiterated Potentia could nominate independent director candidates.

Potentia was also invited to attend a board meeting “to find a way for Potentia to contribute to Vista Group’s ongoing success”. However, it has not taken up the offer.

Shareholders Association chief executive Oliver Mander said his organisation was concerned about increasing the size of the board and struggled to see the additional value that the Potentia nominations would add, as well as the cultural fit.

“It's comprised of what we would consider a good, diverse range of individuals with different skills and has the skill set that's appropriate to govern the company right now,” Mander said.

Vista had been going through a change process and the market had responded positively to that, Mander said.

The dip in the share price indicated the market appeared to be interpreting the move as a distraction to what Vista should be doing, and that was of concern, he said.

Vista had the right board that had successfully led the company through a change process and Potentia had “a pretty weak case” to remove Peterson and Senior, and had not articulated why it wanted the pair removed, he said.

Potentia had previously expressed concerns about the Vista’s margins being less than its peers, but given the shift to a SaaS model that was to be expected, Mander said.

The market appeared to have interpreted Vista’s changes as having been executed well, and that was reflected in the higher share price, he said.

The date of the special meeting and notice of special meeting was yet to be set.

Correction: An earlier version of this story incorrectly said Kirk Senior was the founder of Vista. (Amended at 9.49am, October 2, 2024)