One proxy advisory firm backs shareholder proposals, another supports Orient-Express

By Lisa Kerner

Charlotte, N.C., Oct. 6 - Proxy Governance, Inc. is the third proxy advisory firm to recommend that Orient-Express Hotels Ltd. shareholders vote for both proposals submitted by shareholders at the special meeting on Friday, according to D.E. Shaw Valence Portfolios, LLC, D.E. Shaw Oculus Portfolios, LLC and CR Intrinsic Investors, LLC.

RiskMetrics Group/ISS and Egan-Jones Proxy Services recommended last week that Orient-Express shareholders vote for both proposals, according to D.E. Shaw.

The investors want to amend the company's bylaws to treat class B shares as "treasury shares" under Bermuda law and to cancel the class B shares. As a result, the class B shares held by Orient-Express Holdings 1 Ltd. would lose their right to vote, it was previously reported.

Proxy Governance said it found no reason "to believe that giving the company dictatorial control over every shareholder vote ... is a uniquely effective means of protecting shareholders from anything other than the exercise of their ownership rights in the company," according to D.E. Shaw.

A fourth proxy advisory firm, Glass, Lewis & Co., recommended Orient-Express shareholders vote against the proposals, an Orient-Express news release said.

According to Orient-Express, the proxy advisory firm said, "We do not believe the dissident's assertion that the company's voting structure has impacted the company's stock price performance in recent years warrants significant shareholder concern."

Glass Lewis suspects "that most shareholders both understand and accept the nature and extent of Orient-Express Holdings 1 Ltd.'s control over the company and the composition of its board, particularly since this structure has been in place for a considerable period of time," Orient-Express said in its release.

The D.E. Shaw shareholders beneficially own a total of 6,053,678, or approximately 14.3%, of Orient-Express' class A shares. They intend to vote all of their class A shares for both resolutions and asked fellow shareholders to do the same.

Orient-Express is a Hamilton, Bermuda-based luxury hotel and restaurant operator.

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