Elliott in new attempt to oust AkzoNobel chairman Antony Burgmans
Activist investor Elliott Advisors is making fresh efforts to oust AkzoNobel's chairman, saying the Dulux owner is facing a "crisis of confidence" for the way it handled a 26.9 billion euro (£23.7 billion) takeover bid by PPG.
Elliott said on Friday that it had filed a joint petition to the Dutch Interim Relief Court in hopes of forcing Akzo to hold an extraordinary meeting where investors would have a chance to vote on whether to dismiss Antony Burgmans as chair of the company.
The private investment firm, which has upped its stake to 9.5%, said Akzo is "facing a serious crisis of confidence" and was approaching the court in order to provide a "democratic forum" where the company's management and supervisory board "can be called to account".
"For its part, Elliott has irretrievably lost confidence in the ability of the current chairman of the supervisory board to guide AkzoNobel in a manner which benefits all of its stakeholders," Elliott Advisors said in its release.
"Elliott finds chairman Burgmans' views on shareholder democracy to be archaic and wholly unacceptable in today's capital markets.
"A board which holds itself accountable to no one is not an appropriate governance paradigm. If shareholders are not able to regulate the conduct of AkzoNobel's Boards, who can?"
It marks Elliot's latest attempt to get rid of Mr Burgmans in light of the company's refusal to engage in takeover talks with US chemicals giant PPG.
PPG abandoned its multi-billion euro bid for the company last month after being continuously rebuffed by the Akzo's board.
Akzo's refusal to hold talks with PPG came despite intense pressure from Elliott Advisors, which had been pushing for a deal.
Elliott Advisors also released survey results which polled institutional investors representing around one-third of Akzo's share capital, showing that "the vast majority of respondents are dissatisfied with the leadership" and would like to hold an extraordinary meeting.
"This is particularly due to the way in which the PPG Industries, Inc. ("PPG") approach was handled, with 96% of respondents expressing their dissatisfaction with AkzoNobel's conduct, but importantly, chronic underperformance by AkzoNobel prior to the PPG approach is also cited as a contributing factor. "
An AkzoNobel spokesperson said the company had "taken notice" of Elliot Advisors' release and survey results, adding that it has held its own meetings with shareholders in recent weeks.
"AkzoNobel management had over 130 contacts with shareholders in June alone," the spokesperson said.
"The feedback from these meetings, coupled with a range of shareholder interviews and a survey, will form the basis of the AkzoNobel shareholder relations plan moving forward.
"AkzoNobel is next due to update the market on 25 July at its half-year results."