Eurotunnel board lashes 'amateurs'

THE BOARD of Eurotunnel launched an astonishing attack on dissident shareholders in the Channel Tunnel operator today, in the latest twist of a civil war which could see directors sacked at the company's annual meeting.

In a circular to all investors, the board, led by chief executive Richard Shirrefs, dismisses an attempt to oust the board by shareholder activist Nicolas Miguet in a litany of adjectives calling him and his supporters naive, dishonest, dangerous, pious and amateur.

At issue is an impasse in finances. After it posted a record £1.3bn loss for 2003, directors admitted Eurotunnel, in its current structure, was unsustainable.

Shirrefs has embarked on an as-yet undetailed restructuring, codenamed 'galaxie project'.

It is attempting to negotiate down its £6bn debt, and persuade the British and French governments that the business cannot remain exclusively private-sector financed, without which Eurotunnel will not be able to reduce tunnel access charges to boost traffic between the two countries.

However French shareholders - 60% of Eurotunnel's stock is in the hands of French private investors - are wearying of the continued underperformance of the shares and lack of dividends. They are being whipped up by Miguet and a shareholders' association, Adacte, to back moves to have the board removed at next month's AGM.

The circular tells shareholders to vote against the resolutions.

It states: 'Their only intention is to enable an alliance of convenience to take the place of the board of directors of your company without any serious programme, whatsoever, to ensure the future of Eurotunnel.'

The circular damned dissidents' calls for Eurotunnel simply to renege on its debt commitments to British and French banks as 'naive, if not dishonest' and dismissed their plans to take over the running of the company as 'a catalogue of vague and pious wishes' presented in an 'amateur and improvised' way.

It continues: 'What is their real motivation? Can they claim to have a successful experience in the management of a major infrastructure project? Have they really understood the essential binational nature of our group?'

The circular suggests that Shirrefs and the Eurotunnel board is now taking seriously the threat that they could be ousted.

Until now Miguet, who has convictions for financial chicanery, had effectively been dismissed as a crackpot who had a personal vendetta against Shirrefs.

Eurotunnel shares were steady at 39 3/4p today, against a 12-month high of 70p touched last summer.