Shareholders in Waterford Wedgwood have approved the sale of the firm's US subsidiary, All-Clad, for $250 million (€209 million) at a testy extraordinary general meeting (e.g.m.) in Dublin.
Most of the net proceeds of €179 million that will flow from the sale of the cookware firm will be used to pay down Waterford's debt, which stood at €460 million at the end of March.
Some €20 million will also be allocated to marketing support for Waterford's three main brands - Waterford, Wedgwood and Rosenthal - over the next two years. This will lift the marketing budget for the brands from 2.5 to 5 per cent of sales.
Waterford chief executive Mr Redmond O'Donoghue told shareholders that the firm's debt had been racked up as Waterford had invested in restructuring itself over the past seven years.
When asked by one shareholder why the company was selling a "winner", Mr O'Donoghue explained that it was too expensive for Waterford to bring All-Clad into new markets. The brand is currently sold exclusively in the US.
Waterford is selling All-Clad to French firm SEB. Mr O'Donoghue said SEB had beaten off 44 other interested parties.
He said the sale offered a "compelling opportunity" to realise the value contained within the subsidiary.
He later suggested that shareholders, many of whom are sitting on heavy investment losses, "may not have quite understood the capital gain" that was flowing from All-Clad. He said All-Clad was being sold at an "exceptional" price that equated to 17 times profits and 56 times earnings.
Waterford bought All-Clad five years ago for $110 million. The cookware company reported an after-tax profit of $11 million in the year to March.
Another shareholder asked why top executives within Waterford should earn high salaries while the firm was performing poorly.
Last month, the company reported a pre-tax loss of €45 million for the year to the end of March. Shares in Waterford weakened by 3 per cent yesterday, closing at 15 cents.
