Major Rona shareholder Invesco seeks to replace board

Wed Nov 14, 2012 11:07am EST
 

(Reuters) - Invesco Canada Ltd (IVZ.N: Quote), one of the largest investors in Rona Inc (RON.TO: Quote), said it would ask the Canadian home improvement chain to call a shareholder meeting to vote on removing its directors, a move that could intensify takeover speculation.

Rona stock rose more than 7 percent after Invesco announced its intentions in a statement on Wednesday. Invesco controls about 10.16 percent of the retailer and distributor's outstanding shares.

Rona's longtime Chief Executive Robert Dutton stepped down on Friday following disappointing quarterly results, reviving speculation that the company is in play. The company had no immediate comment on Wednesday morning.

U.S.-based rival Lowe's Cos Inc (LOW.N: Quote) withdrew a C$1.8 billion ($1.8 billion) proposal to buy Rona in mid-September after opposition from the Canadian company's board and management.

The proposal, which never became a formal offer, also faced criticism from politicians in Rona's home province of Quebec and many of its independent dealers.

Rona's biggest shareholder is Quebec's pension fund Caisse de dépôt et placement du Québec, which controls just over 15 percent of Rona, according to Thomson Reuters data. The fund could not immediately be reached for comment.

Rona's acting chief executive, Dominique Boies, joined the company in 2011, after five years with the Caisse.

The fund, which has a dual mandate of managing the Quebec pension plan and contributing to economic development, boosted its stake after Rona made the Lowe's proposal public.

Rona was much discussed during Quebec's autumn election, with politicians from both the incumbent Liberal Party and the eventual winner, the Parti Quebecois, opposed to a takeover of the firm, which has deep roots in the province.   Continued...