AMSTERDAM: AkzoNobel shareholders and a US hedge fund manager went to court Monday seeking to force the world’s leading paint manufacturer to allow a vote on ousting the Dutch company’s chairman amid a fierce takeover bid.
Activist investor Elliott Advisors, and at least seven other shareholder groups, accused the company’s management of “creating a crisis of confidence” among its shareholders after AkzoNobel rejected three takeover offers from US rival PPG.
The activist investor Elliott has lodged its case with the Dutch Enterprise Chamber in Amsterdam, asking the tribunal to order an extraordinary meeting of AkzoNobel shareholders, which could vote on whether to dismiss board chairman Antony Burgmans.
“Shareholders are single-handedly being robbed of their right to call to account those in charge of policy, namely Burgmans,” said lawyer Jan Willem de Groot, acting for Elliott.
“There is a serious crisis of confidence between AkzoNobel and a large group of shareholders,” De Groot told the packed courtroom, where Burgmans was also present, flanked by his own lawyers.
Chief executive Michael McGarry of the Pittsburg-based PPG also attended Monday’s hearing.
AkzoNobel, whose best-known brands include Dulux and Trimetal, earlier this month snubbed a third takeover offer by PPG — which valued the company at some 24.6 billion euros ($27 billion).
Brushing off the offer, AkzoNobel said PPG’s deal undervalued the group and “contained significant risks and uncertainties”.
Elliott, headquartered in New York, holds a stake of just over 3.0 percent in AkzoNobel but together with other shareholders in favour of the deal with PPG, claims more than 17 percent representation — enough to force a special shareholders’ meeting.
De Groot said “the rapid way” in which AkzoNobel’s board had refused Elliott’s and other shareholders’ request for an extraordinary meeting was “unacceptable”.
“A large group of shareholders have lost their confidence in Burgmans and therefore wants an extraordinary meeting,” Elliott’s lawyer said.
AkzoNobel, formed in 1994 from the merger of the Dutch and Swedish firms Akzo and Nobel, has said it believes there is a “significant integration risk” to a tie-up with PPG, warning the US company has provided no job guarantees for its 46,000-strong workforce.
It has also stood by Burgmans saying his dismissal “would be irresponsible, disproportionate (and) damaging”.