Vital Healthcare Property Trust has finally found a so-called independent director, Graham Stuart, who was Sealord’s chief executive until 2014 and before that Fonterra’s chief financial officer for seven years.

Vital’s manager, Canada-based NorthWest Healthcare Properties, has been looking for somebody to replace former chairman Graeme Horsley since he resigned in early May.

Stuart is currently chair of Eroad and an independent director and chair of Tower’s audit committee.

Chair Claire Higgins says Stuart’s appointment follows a comprehensive search process assisted by international recruitment firm Heidrick & Struggles and which canvassed “a broad field of candidates,” including a number put forward by investment institutions in New Zealand.

“We have welcomed the opportunity to engage with interested unitholders in this context and, in particular, their willingness to put forward potential candidates ahead of the formal nominations process,” Higgins says.

While the press release says Stuart will be independent, Vital’s trust deed gives NorthWest the right to fire directors at will for any or no reason.

While this is at odds with the NZX listing rules, NZX granted Vital’s previous manager, ING, a waiver from those listing rules in November 2007.

BusinessDesk is aware of at least one candidate who pulled out of the running because they would not in fact be independent.

The press release says Stuart’s appointment has NorthWest’s support – NorthWest owns nearly 25 percent of Vital’s units.

“The board is very pleased to have completed the appointment of an independent director with such outstanding governance and commercial skills,” Higgins says.

“Vital has been a strong and consistent performer over the past decade with unitholder returns comfortably exceeding the total sharemarket and peer group indices over that period.”

While it is true that the units have performed well over the long term, over the past year they have fallen more than 5 percent while the benchmark NZX 50 has gained nearly 12 percent.

“We are confident that Graham will play an important role in our drive to maintain a high level of performance into the future.”

Higgins says the appointment fulfills the board’s undertaking to make such an appointment before the next annual meeting of unitholders.

NorthWest hasn’t set the date for that meeting yet – last year’s annual meeting was held on Nov 9 – but now says the deadline for unitholders to nominate a person for election as an independent director is Nov 26.

Given Stuart’s appointment, “any nominations received will result in a contested election. In that event, NorthWest … will vote its Vital units in favour of Mr Stuart.”

Vital Healthcare units last traded down 0.5 percent at $2.08. 

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