Domino's UK investor urges scrapping takeover plans and boosting buyback as shares hit 10-year low
Former non-executive director calls for quadrupling of capital returns after Domino’s announces £20m buyback amid profit warning and share-price slump
A former Domino's Pizza Group director has urged the company to abandon any plans to acquire a secondary brand and to substantially increase capital returns, saying the group's recently announced £20 million buyback "does not go far enough" as shares trade at a 10-year low.
Usman Nabi, founder and investment chief of Browning West and holder of about a 5% stake in the FTSE 250-listed Domino's master franchise, wrote in an open letter on Wednesday calling for an urgent discussion of "the appropriate scale of capital return and the company's strategic direction." Nabi served as a non-executive director of Domino's between 2019 and 2023.
Domino's revealed a £20 million share buyback last week as part of efforts to reassure investors after it cut profit guidance last month. The company has blamed weaker consumer demand and higher costs for weighing on earnings; its shares have lost almost a third of their value since the start of the year and were trading at about 208.2 pence, a 10-year low.
In his letter, Nabi urged the board to abandon moves to acquire a secondary brand and to reconsider the scale and speed of returning cash to shareholders, pressing for a materially larger buyback. He framed the call as part of a broader debate over strategic priorities after the firm downgraded its outlook.
Domino's Pizza Group is the UK master franchisee of the international pizza chain and is widely followed by investors for its delivery-focused business model and pricing sensitivity to consumer spending. The company's decision to implement a buyback followed investor concern after the profit warning and comes amid wider pressure on consumer-facing businesses to prove resilience in the face of rising costs and subdued demand.
Nabi's intervention is the latest example of shareholder activism in the UK market, where significant investors sometimes press listed companies to adjust strategy or capital allocation when performance weakens. The open letter was sent to the group's board on Wednesday; the company has previously said it will keep shareholders informed of material developments.
Investors will watch whether Domino's alters its planned strategic moves or adjusts the size and timing of capital returns in response to shareholder pressure and the sustained dip in its share price.