Morley To Vote Against Reelection Of Vodafone CEO Sarin

LONDON -(Dow Jones)- Morley Fund Management, the fund management arm of UK insurer Aviva PLC, said Friday it would vote against the reelection of Vodafone Group Chief Executive Arun Sarin at the company's forthcoming annual shareholder meeting.

Morley said it would also vote against the reelection of a number of board members at the company's annual shareholder meeting in London Tuesday.

Morley, which has a 2.1% holding in Vodafone, said in a press statement "while it is encouraged by recent developments in company strategy it has decided to vote against the re-election of a number of the incumbent non-executive directors and also Arun Sarin."

Morley is the latest of several shareholder groups to raise public questions about the company's corporate governance or strategy.

Manifest, Pensions Investment Research and the Association of British Insurers have recently raised concerns about executive bonus targets.

Press reports recently have reported infighting on the company's board, with claims that some directors who predate Sarin's appointment are unhappy with strategy.

The company's former chairman Chief Executive Christopher Gent quit as honorary life president in March, saying he didn't want to continue if a "disinformation campaign" about the company continued.

The exit of Gent, seen as responsible for building Vodafone from a small local carrier to a telecoms giant, coincided with disappointing mid-term guidance from the company.

This triggered a goodwill write-down of up to GBP28 billion, after which Vodafone reported a GBP14.9 billion pretax loss.

Sarin has invested heavily in emerging markets such as Turkey, eastern Europe and Africa in the past six months in a bid to offset competition in core markets.

But analysts have raised questions about some of the prices paid for these assets. Vodafone earlier this year sold its Japanese business for GBP8.9 billion after failing to make headway in the country.

Company Web site: http://www.vodafone.com

-By Jessica Hodgson, Dow Jones Newswires; +44 207 842 92 93; jessica.hodgson@dowjones.com

(END) Dow Jones Newswires "

Posted to the site on 22nd July 2006