Several New Zealand newspapers, including the New Zealand Herald and Dominion Post, have reported that angry minority shareholders’ resolutions will be put to Contact’s annual general meeting in Auckland on Thursday.

The Dominion Post says minority shareholders, led by Brook Asset Management and the New Zealand Shareholders Association, have called for the removal of Contact deputy chairman Phil Pryke and directors Tim Saunders and John Milne, claiming they failed to properly represent shareholders’ interests during the proposed merger with Origin Energy earlier this year.

The Wellington paper also quotes Tyndall Investment Management equity manager James Lindsay as wondering how independent Contact’s independent directors can be if only Origin Energy votes keep them on the board.

The NZ Herald says fund management advisory firm Institutional Shareholder Services (ISS) has thrown its weight behind moves to remove the independent directors and also wants Contact to introduce measures to avoid conflicts of interest involving its 51.4% owner, Origin Energy.

The Auckland paper adds that ISS regional director Dean Paatsch supports an orderly succession plan for Pryke, Saunders and Milne.

As well as the aborted Origin-Contact merger, Pryke, Saunders and Milne also supported an unsuccessful takeover bid by Contact’s former owner Edison Mission in 2001, despite that $NZ4.25 per share offer being at the bottom, or below, independent valuations. Edison Mission subsequently sold out to Origin when it failed to win the support of the minorities.

Other motions that the disgruntled shareholders propose tabling at Contact’s AGM include:

• Creating an independent committee to handle business decisions related to Origin;

• Changing Contact chief executive David Baldwin’s terms of employment so he is employed directly by Contact, rather than seconded from Origin; and

• Recovering from Origin Energy the $NZ8.6 million ($A7.5 million) Contact spent on the aborted merger.

But none of the motions are likely to be carried, as Origin is opposed to them and should vote them down.

Contact does not support any of the resolutions, saying the directors adequately represent shareholders’ views and the company has procedures to manage conflicts of interest.

In June, Contact and Origin abandoned their controversial merger to create one of Australasia’s largest integrated energy groups with a combined market capitalisation of about $9 billion, citing a lack of support from key Contact shareholders.

Origin also refused to improve the terms of its offer to Contact minority shareholders, offering the equivalent of about $7/share. Contact’s shares this morning were trading at $7.30-7.33.