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TELEWEST chairman Cob Stenham, forced last weekend to admit to an error over directors' pay, appears to have misled shareholders for a second time, the London Evening Standard's Business Day section has revealed.
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Stenham repeatedly reassured shareholders at the company's annual meeting last week that no directors had sold any Telewest shares. Yet this claim is contradicted by evidence of the sale of 46,686 shares by finance director Charles Burdick last November. Burdick sold the shares at 74p, making £34,548, which he used to meet an income tax demand, according to a company filing dated 19 November. Today the shares stand at less than 3p.
At the AGM Stenham tried three times to placate a shareholder concerned that the directors may have bailed out when the share price was higher than now. 'I can assure you, I think, I'm looking at my colleagues, that none of them have sold any shares,' Stenham said. Telewest shares 'have not been sold by your board', he later emphasised. Questioned again about possible share sales by directors, he closed the debate by insisting: 'Not by any of us.'
Burdick sat silent throughout this lengthy exchange. Today he said: 'I think in retrospect I should have clarified the point.' Telewest said: 'We regret any misunderstanding.' A spokesman said: 'The chairman was trying to rebut a line of questioning that suggested directors somehow were benefiting at the expense of shareholders.' He said the sale was 'technical' and claimed that 'no cash benefit accrued to Mr Burdick'. In fact there was a benefit - the money was used to pay a tax bill on shares given to Burdick under a bonus scheme.
The error follows Stenham's claim at the same meeting that no director had been given a pay rise. Stenham, a former finance director of Unilever, was forced to correct that statement last weekend, admitting he had made a mistake. It was also Burdick's affairs which led to that error. Burdick's base pay had been raised from £360,000 to £400,000.
Shareholders in the cable group have suffered a collapse in the share price from as high as 563p as the company struggles to finance £4bn of debt. A massively diluting debt-for-equity swap is seen as increasingly likely.
Burdick revealed that Telewest is now going through a transcript of the meeting to ensure there were no other errors. Chief executive Adam Singer also sold 194,508 shares in March at 17 1/2p for tax planning purposes. His wife Jill bought the same number of shares at the same time.
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