Headlam shareholder seeks board shakeup including removal of chair

(Alliance News) - Headlam Group PLC on Monday said it has received a requisition notice from 10% shareholder First Seagull AS, which seeks to replace its chair and two directors due to "deteriorating operational performance".

The Birmingham, England-based floor coverings distributor said the requisition notice proposes resolutions to remove Chair Stephen Bird and directors Jemima Bird and Karen Hubbard.

First Seagull proposes the appointment of Andrew Davis as chair with its own Managing Director Stian Husvaeg as non-executive director.

Norwegian alternative investment fund First Seagull said the Headlam board "approved and oversaw a strategy developed by external consultants and executed by leadership with limited flooring experience" that has "destroyed" its "dominant market position by competing against core customers".

"The result is a deeply dissatisfied customer base, deteriorating operational performance, frustrated and concerned suppliers, and a culture facilitating mediocrity," First Seagull said.

In response, Headlam said: "The board is confident that the recently refreshed board (including a new executive team and two new non-executive directors) has the right experience to implement the company's strategy and turnaround, and is getting on with doing so at pace."

The Headlam board also noted "extensive engagement" with shareholders including First Seagull over recent months and said it intends to "maintain that dialogue".

Headlam advised its shareholders to take no action and await a further announcement. It said the requisition notice does not impact its annual general meeting, which will take place on May 20.

Last month, Headlam said its new strategy will mean a "material planned reduction in revenue over 2026 and 2027".

"Once fully implemented, and, assuming a stable market, this is expected to result in a smaller base revenue on continuing operations but with a significant enhancement to quality of earnings through enhanced gross margin and lower operating costs," it added.

It has confidence that a return to profit can occur in 2027, as previously guided.

Shares in Headlam were up 3.9% at 29.20 pence on Monday morning in London.

By Michael Hennessey, Alliance News reporter

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