The Stock Exchange's watchdog has got involved in NZ Automotive Investment's tangled boardroom drama.
NZ Automotive Investments owns the nationwide chain 2 Cheap Cars. Photo: Facebook / 2 Cheap Cars
NZRegCo, the regulatory arm of NZX, has asked the company to explain by the end of Monday how it is complying with the rule of having at least two independent directors on its board.
The used car seller and auto finance company was rocked last month by the surprise resignation of three independent directors because of a breakdown in the relationship with fellow director and major shareholder David Sena.
NZRegCo has questioned the independence of the nominees to fill the vacancies, David Shaw and Michael Stiassny -- both promoted by Sena.
"NZ RegCo is concerned about the circumstances of the exit of the resigning directors, and notes the involvement of Mr Sena in the nomination and intended appointment of Mr Shaw and Mr Stiassny."
The watchdog said independent directors were a fundamental obligation of listed companies.
Sena confirmed he was moving to replace three of the directors at the 25 August annual meeting with his own nominations because the company needed directors that could devise a strategy to turn around and grow the company and its profits. He invited veteran businessman Stiassny to join when two of his nominees withdrew.
NZRegco had asked the current Automotive Investments' board to assess the independence of Shaw and Stiassny, which must also be contained in the formal meeting notice to shareholders due out next week.