Templeton Global Equity Group Comments on Akzo Nobel Rejection of Elliot Advisors' Proposal to Call for an EGM
London, April 12, 2017 - Templeton Global Equity group has been long-term investors in Akzo Nobel for many years and currently manage total shareholdings of 3.9% in the company. We are interested in the long term success of Akzo Nobel, and we believe an essential requirement for this is appropriate respect for, and engagement with, shareholders by the Board.
We would like to reiterate that, while we do not necessarily believe that the current offer is the right one, we do believe that Akzo Nobel’s Board has an obligation to its shareholders and other stakeholders to engage in a dialogue with PPG, in order to have a fuller understanding of PPG’s proposal. Aside from price, there are several issues that Akzo Nobel has highlighted—such as company culture, anti-trust issues, employee jobs and pensions – which are potentially important concerns but which can only be properly appraised and solutions considered in dialogue with PPG.
Whilst we are well aware that the Board has many stakeholders to consider, shareholders are ultimately the owners of the company and no offer in relation to the company’s shares should be dismissed without full and careful assessment of the offer’s potential and due consideration of the will of the shareholders. In this regard, we have been disappointed by the Board’s unwillingness to have any dialogue with PPG and its failure to respond satisfactorily to our concerns.
For this reason, we supported the recent proposal by Elliott Advisors to call an EGM with the purpose of considering whether Mr Burgmans is the right person to continue to lead the Supervisory Board. We have made no commitment as to how we may vote at such EGM but we do expect Akzo Nobel to respect shareholders’ rights to request that such a discussion takes place. Therefore, we are disappointed in the first response by Akzo Nobel to this request, which indicates an intention to refuse to honour the shareholders’ rights. We encourage the Board to respond respectfully to the request and to arrange the meeting in the earliest possible timeframe.