Purge of Erinaceous board could include chairman

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Purge of Erinaceous board could include chairman

By Irene Chapple, Michael Glackin and Michael Glackin Michael Glackin Irene Chapple2007-11-09T00:00:00+00:00

All change: Turnbull is expected to leave, along with Cummings and Bellis (also pictured), before the end

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Nigel Turnbull set to follow founders Neil Bellis and Lucy Cummings out of the door

The clear-out at troubled property services company Erinaceous that began this week is also expected to claim the scalp of the chairman by Christmas.

Neil Bellis, the former chief executive, and Lucy Cummings, the chief operating officer, were sent on gardening leave this week after pressure from activist shareholder Fursa.

The two are now negotiating their exit from the company, which they founded in 1999. It was a market darling before it was hit by allegations of fraud and mismanagement.

An insider said Nigel Turnbull, the chairman, would also be 鈥渢ransitioned out鈥� by the end of the year. A spokesperson declined to comment on this.

Turnbull took the reins after Bellis was forced to stand down as chief executive in September. Bellis retained his place on the board until this week.

An insider said: 鈥淭he aim is to reach agreement with the pair without having the expense of an extraordinary general meeting.鈥�

Fursa declined to comment on whether it would continue to push for an extraordinary general meeting, despite the fact that the departure of Bellis and Cummings was the chief reason for having it.

Last week Erinaceous appointed Tim Redburn, a turnaround specialist, as interim chief executive. Fursa, which owns 19% of the shares, had insisted on putting its own management team into the company.

However, the source said: 鈥淚 don鈥檛 think Fursa will press to have its own management team brought in now.

鈥淩edburn is an outsider and we believe Fursa will wait and see how he performs.鈥�

Redburn declined to answer any questions this week.

A strategic review by Close Brothers and KPMG, focusing on reducing the company鈥檚 debt, is due to be presented to the board later this month.

Fursa is examining the disposal of some of what the source called 鈥渘on-core, non-profitable assets鈥�.

The insider said: 鈥淪ome non-core assets will be sold for liquidity, but there is not going to be a discount sale for management buyouts or core businesses that can make profits. Selling family jewels isn鈥檛 what we鈥檙e about.鈥�