The Bookseller.com

5th July 2009

« Headlines

PFD agents warn off buyers

02.07.07 Philip Jones

The senior managers of the literary agency PFD have warned parent CSS Stellar that they will not support the sale of the firm to a third party, after claiming that the board failed to disclose details of an attempted £4m management buyout to shareholders. CSS is reported to be in negotiations over an £8m sale of the rights arm to licensing company Chorion, as part of a range of measures aimed at addressing investor concerns.

St John Donald and Maureen Vincent, joint chairs of PFD, said in a statement: "We have had confirmation that one of the companies reported to be interested in PFD will not proceed in talks with CSS Stellar unless PFD's management and all principal agents support its approach. We have made it clear to CSS Stellar that our board and all principal agents are committed to the management buy-out of the firm."

In an unrelated event, CSS was forced to write to shareholders in June after one of its directors--Duncan Soukup--called for an overhaul of the board. An Extraordinary General Meeting has been planned for 3rd July.

But Donald and Vincent insist that their offer should have been set out to shareholders as part of this communication: "We are surprised that no announcement of our offer of 4th May 2007, which would result in CSS Stellar receiving more than £4 million in cash for our business, was included in the communications from the chairman of CSS Stellar sent to the shareholders."

PFD's 14-strong management buyout team--believed to include literary agents Caroline Dawnay, Simon Trewin, Robert Kirby, Charles Walker and Rosemary Cantor--launched the management buyout bid in May. "We have been in discussions with CSS Stellar concerning a management buy-out for nearly six months," said the joint chairs.

Soukup, who controls just over 29% of the Aim-listed group, has accused his fellow board members of a string of material failures and is putting forward resolutions calling for them all to be replaced. The remaining members of the CSS Stellar board have accused Soukup of attempting to take control of the board.

In a statement released to the press last week, CSS Stellar said it had received a number of approaches from parties expressing interest in acquiring PFD, including one from members of PFD's management team. "A decision has not been made on whether to pursue an immediate sale of PFD, or any other of the company's operating assets, nor will one be made prior to the EGM of the company convened for 3rd July 2007".

CSS, which is listed on Alternative Investment Market, bought the literary and entertainment agency formerly known as Peters Fraser Dunlop in November 2001 for around £12m. PFD represents hundreds of writers including Simon Schama, Alan Bennett and William Trevor. Its actor roster includes Ricky Gervais and Kate Winslet.

Rights Philip Jones PFD CSS Stellar