| Payzone ordered to reinstate directors |
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| Friday, 01 February 2008 | |
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A High Court in Ireland has ordered payment services firm Payzone to give CEO John Nagle and chief financial officer John Williamson their job back.
UPDATED: Thian claims shareholder backing at Payzone The two executives had earlier returned to work after they successfully sought a court injunction to overturn their forced departure. The relationship with the rest of the firm’s management had deteriorated to such an extent that they found it impossible to carry out their business as usual. They subsequently threatened to sue their fellow board members for “reputational damages”. Nagle is considered one of Ireland's leading businessmen. The High Court was asked to judge whether Payzone chairman Bob Thian had followed proper procedure by announcing the pairs departure after a mere telephone call around the firm's non-executive directors rather than after passing a resolution in a board meeting. Nagle is alleged to have criticised Thian's behaviour as chairman in a letter. Thian in turn accused Williamson of misconduct over an alleged failure to provide financial information. Williamson denied the charges, but claimed that he was not given opportunity to respond before his departure was made public. Retailer payment outlets Payzone is the largest branded independent network of retailer payment outlets in the UK with a network of over 30,000 locations. The company's network enables people to pay their rent and energy bills electronically in shops. The ATM firm is the result of a merger last year between the Irish payment firm alphyra Holdings Limited and the British firm Cardpoint. Nagle and Williamson both joined the firm from alphyra, while the rest of the board consists of former Cardpoint managers. The company saw a 42 per cent drop in its share price drop over recent weeks, but shares where suspended at the firm’s request when Nagle and Williamson filed for a court injunction. In the months before last year's merger the newly formed company was estimated to be valued at anything between €400 and €700 million. The company’s current value is £143.8 million (€190.3 million). Strong platform The board of Payzone plc announced two weeks ago that chief executive John Nagle and chief financial officer John Williamson had left the company. Thian, previously chairman of Cardpoint, assumed executive responsibility for the company with immediate effect. Thian said that Nagle and Williamson had created a strong platform for growth at Payzone (LSE:PAYZ), but that the company had reached a stage of its development where a different set of skills was required. On Friday Justice Maureen Clarke said that the two men had not been afforded a fair treatment and that Payzone had failed to provide evidence that a majority of shareholders had lost confidence in them. The saga has not yet have reached its end. A full trial is also expected to take place within weeks. Balderton Capital, Payzone’s largest shareholder which owns 40.5 per cent of the shares of the company, said it supported the decision of the board and agreed not to sell any of its shares in the market for at least six months. Staff at Payzone's Blackpool Business Park-based offices are awaiting an announcement, expected on 28 February, of around 60 redundancies as a result of the firm's completed merger. Related articles
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