Laurence Orbach, the 70-year-old academic and executive chairman of Quarto, has been deposed as a director of the publishing group he founded nearly 40 years ago.
Close to 55 per cent of shareholders voted against him at a quiet meeting called by Harwood Capital, the private equity investment group headed by Christopher Mills, and the Wellcome Trust, who together spoke for 29 per cent of Quarto shares.
Mr Orbach did not attend Wednesday’s meeting but the die was cast after his former business partner Robert Morley raised his stake to 6 per cent and switched sides to back the dissidents at the end of last week. Mr Morley, who founded Quarto with Mr Orbach in 1976, stepped down from the board in May.
The vote marks the end of a long-running battle between Mr Orbach, brother of the psychotherapist Susie Orbach, and Mr Mills, grandson of circus impresario Bertram Mills. Mr Mills bid for the publisher’s shares in 2003 having lost confidence in Mr Orbach’s management. Since then Mr Mills has become increasingly unhappy at the steady rate of Quarto acquisitions which he said lacked focus or rationale.
He and the dissidents claimed that Quarto, which is capitalised at £28m, has spent about £45m on imprints around the world since 2003.
The London-based publisher, which employs about 500 people, has bought up more than 20 publishing imprints, including children's books Frances Lincoln and Quiver Books, which specialises in sex manuals such as the Bedside Kama Sutra.
Last week the group said revenues had slipped from $131m in the third quarter of 2011 to £127m in the same period this year. Pre-tax profits dipped from $6m to $5.5m. Quarto’s pre-tax profits for the six months to June fell 9 per cent to $341,000. Net debt stood at $87m at the time.
In April, Mr Orbach, who owns about 14 per cent of Quarto, signalled his intention to split the role of executive chairman by bringing in Marcus Leaver, a former executive of US publisher Barnes & Noble, as chief executive designate.
However, in July Mr Mills called for a shareholder vote to replace Mr Orbach with Tim Chadwick, a turnround specialist, as chairman.
Mr Chadwick said on Wednesday night following his first board meeting as Quarto’s chairman that Mr Leaver would become chief executive as soon as possible. He said “Mr Leaver is someone I can do business with. Now we will look at all the assets, one by one, [to assess] what they do and how they fit and whether they work within the group.”