Rebel shareholder threatens legal action if Akzo rejects vote on chairman's dismissal
By Thomas Escritt
AMSTERDAM (Reuters) - A rebel shareholder in Akzo Nobel (AKZO.AS: Quote) threatened the Dutch paint maker with legal action on Wednesday after the company said it would reject any proposal for a vote on dismissing its chairman at a shareholders' meeting.
Fund manager Elliott Advisors is one of a group of shareholders who want to oust Chairman Antony Burgmans, an opponent of U.S. rival PPG Industries' (PPG.N: Quote) attempt to take over the company.
Elliott, one of Akzo's largest shareholders, had earlier said it, together with other investors, had the 10 percent support needed under Dutch law to call an extraordinary shareholders' meeting to vote on Burgmans' dismissal.
"Shareholders have a legal right under Dutch law to put a proposal to dismiss Mr. Burgmans onto the EGM agenda," Elliott said in a statement in response to what it called Akzo's "inexplicable" refusal. It said it was prepared to take the matter to the Dutch courts.
But a person familiar with Akzo's thinking, who did not wish to be named, disputed that shareholders have such a legal right.
Elliott and other investors have pushed Akzo to hold talks with U.S. coatings manufacturer PPG after the Dutch company rejected a sweetened 22.4 billion euro ($24 billion) cash-and-stock proposal from PPG last month.
Akzo has declined, instead touting an alternative plan to spin off its chemicals arm, representing about a third of its operations.
"We fail to see how Akzo Nobel could have a meaningful discussion with shareholders about its plans for a potential separation of the specialty chemicals business while the alternative of a transaction with PPG is being effectively disregarded from the outset," Elliott said in a letter sent to the company's management on Wednesday. Continued...