Chairman of Wagamama owner to step down after months of activist pressure
Ken Hanna cited ‘personal reasons’ for deciding not to seek re-election as The Restaurant Group’s chairman.
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The chairman of Wagamama owner The Restaurant Group (TRG) has announced plans to step down after facing months of pressure from activist investors to overhaul its strategy and leadership.
Ken Hanna said he would not be seeking re-election at the company’s next annual general meeting during 2024, citing “personal reasons” for the decision.
TRG, which also owns Italian-American food chain Frankie & Benny’s, said it will begin the search to find a new chairman.
Mr Hanna will step down once a successor is chosen.
It has been a privilege to work at TRG and I will be leaving the company in great shape with the business trading really strongly, outperforming the market and making good progress on its strategic options
The decision comes despite the company reporting a boosted financial performance earlier this week having clawed back profits over the latest half-year and seeing higher sales.
It painted a more positive picture for the casual-dining sector which has been impacted by squeezed consumers paring back spending.
But a number of investors, led by activist fund manager Oasis Management, have called for Mr Hanna’s removal, along with the chief executive Andy Hornby and remuneration director Zoe Morgan.
At TRG’s annual general meeting in May, Oasis, which owns around a 15% stake in the group, led a rebellion over its pay report for last year.
Almost 35% of investors voted against the remuneration policy for directors, which handed Mr Hornby a total pay package worth £792,000 for 2022, and there were significant votes against the reappointment of the bosses.
It came after the company reported losses of £86.8 million for the year.
But on Wednesday, TRG said it returned to a £2.3 million pre-tax profit in the six months to the start of July, and upped its earnings outlook for the current financial year.
Cost pressures have been improving over the medium term, it said.
Mr Hanna said: “It has been a privilege to work at TRG and I will be leaving the company in great shape with the business trading really strongly, outperforming the market and making good progress on its strategic options.”
Following the optimistic update, Mr Hanna clearly decided now is a good time to depart, rather than engaging in a dispute with activist investors that could detract from the company’s gathering momentum
Chief executive Andy Hornby said: “On behalf of the board I would like to thank Ken for his outstanding contribution to the business.
“He has been an exceptional chairman and a hugely valued colleague during a critically important period for TRG as we have successfully recovered from the Covid pandemic and made good progress with our strategy.”
Shares in TRG jumped by more than 6% on Friday following the news.
Victoria Scholar, head of investment at Interactive Investor, said: “This week, Restaurant Group said it expects higher annual profits after reporting an increase in first-half earnings.
“Following the optimistic update, Mr Hanna clearly decided now is a good time to depart, rather than engaging in a dispute with activist investors that could detract from the company’s gathering momentum.”