Legal bid to remove chairman
The takeover battle for the Dutch AkzoNobel paints and coatings group by the US PPG Industries group is becoming more embroiled. The third bid by PPG, amounting to €26.9bn, has been rejected by AkzoNobel, the owner of important yacht paint brands such as Awlgrip and International Paints.
Also a legal challenge to remove AkzoNobel chairman, Antony Burgmans, has been launched by the rebel shareholder Elliott Advisors, a US-based hedge fund which holds a 3% stake in the Dutch company. Elliott has been pressuring AkzoNobel management to engage in talks with PPG about the bid.
In a statement, Elliott says: “Akzo's rejection of its third proposal without entering into any constructive form of engagement is a flagrant breach of AkzoNobel's boards' fiduciary duties and of Dutch corporate law and an arrogant dismissal of recognised principles of proper corporate governance".
Furthermore, Elliott suggested that AkzoNobel’s reasons for not starting talks about the offer “were unconvincing and unsupported by any available evidence”.
PPG’s third offer made yesterday included a €6.75 per share increase over the second bid, taking the amount offered per share to €96.75. The AkzoNobel management indicated the latest offer still undervalues the company and that its strategy of splitting up the chemicals and coatings arms of the group offers “a superior route to growth and long-term value creation and is in the best interests of shareholders and all other stakeholders.”