The founder of Coffee Republic is facing a shareholder revolt, after major investors Surthurst and Plymouth Land called for an extraordinary general meeting (EGM) to vote on his removal.
Surthurst and Plymouth Land, which together hold around a 24% share in the company, want chairman and chief executive Bobby Hashemi to be removed and replaced by Brian Carroll.
They also want Christian Reeve and Peter Breech to be appointed as directors.
Coffee Republic said it would advise shareholders to appose the proposals at the yet unnamed date of the EGM.
Hashemi said: “Nobody cares more than I do about this business. However, this proposal is a long way from being in the company’s interests and so I will be voting against it and urging shareholders to vote against it.”
Hashemi had been forced to deny claims by disgruntled shareholders earlier this year that he had run the company as a “fiefdom” and understated how well it was doing in the hope of launching a management buy-out on the cheap.
At the company’s recent full-year results Hashemi said he had repeatedly dismissed reports of an MBO and added criticism was now “scaring off potential franchisees”.
Losses widened to £1.45m for the year to 26 March, against £1.4m last year, and overall sales were down 15% to £14.9m.
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By Chris Druce
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