Spotless: we can clean up

Responding to shareholder and former managing director Brian Blythe at the group's annual meeting yesterday, Mr Smedley said the Spotless board was focused on long-term profitability.

He reaffirmed the board's belief that a $698 million takeover proposed this week by private equity group Pacific Equity Partners considerably undervalued the business.

His comments came after Mr Blythe - one of the major shareholders supporting Pacific Equity's bid - noted at the annual meeting that between 2006 and 2011, total annual dividends had fallen from 28.5c to 17.1c a share.

Mr Blythe questioned whether, in the five years since 2007 - when the board proposed to transform the company - it had put enough focus on shareholder returns.

In a colourful general meeting, Mr Smedley also fended off criticism over the group's handling of a pay dispute with staff.

He was on the end of a tirade for rejecting the takeover bid from angry retail shareholder Ron Furlong.

"The slope is in concrete, it's going to be taken over, it won't survive," he said, noting that executives had failed to meet projected targets.

Mr Smedley remained adamant the $2.63 price offered by Pacific Equity did not reflect Spotless' true value.

Earlier, Spotless said ongoing investments in information technology would help the company lift earnings by up to $25 million, once the investment program was completed in 2013-14.

Management also expected profitability to improve strongly in 2012.

Earlier, United Voice union president Marie Angrilli made a plea to for Spotless to put on more staff, relieving struggling shopping centre cleaners of crippling workloads, and agree to the union's pay demands.

Mr Smedley said United Voice should not target the over-award wages and conditions provided by Spotless, but instead expose "fly-by-night" cleaning contractors undercutting the company and paying illegally low wages.

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