MOSCOW (MRC) -- Saint-Gobain's attempted takeover of Switzerland's Sika took another twist as two investors said they will appeal a ruling stipulating that the French building materials company is not required to make an offer for all of Sika's shares, as per Reuters.
The French group agreed in December to buy from the Burkard-Schenker family a 16.1 percent stake that carries 52.4 percent of Sika's voting rights -- enough for control and, at 2.75 billion Swiss francs (USD2.86 billion), a far cheaper option than buying the whole company.
Sika's management and many shareholders have objected to the move, arguing that Saint-Gobain is abusing the company's bylaws and that the extra voting rights are not transferable. Switzerland's takeover board on Wednesday dismissed an objection from Sika investors Cascade Investment and the Bill and Melinda Gates Foundation, ruling that an "opting out" clause was applicable to Saint-Gobain's offer.
The clause in the Swiss company's bylaws allows Saint-Gobain to avoid rules that would normally oblige it to make an offer for all of the shares. The two investors said on Thursday that they would lodge an appeal against the takeover board's decision with Swiss financial regulator FINMA.
Sika said last month that the two investors jointly held 3 percent of Sika's voting rights. Saint-Gobain had no immediate comment on the investors' plan to appeal. Shares in Sika opened 2.8 pct lower. At 0746 GMT the shares were down 1.2 percent.
Last month the takeover board declared the opt-out clause valid but declined to rule on whether it can be used to take control without a full bid. Another issue in the proposed takeover is a decision by the Sika board in January to reduce the Burkard-Schenker family's voting rights.
Sika's board argued that the company's articles of association state that a registered shareholder should not hold a stake larger than 5 percent. The Burkard-Schenkers and their SchenkerWinkler Holding (SWH) vehicle had been exempt from this rule because of the family's close association with the company over more than a century and because it had pledged to protect the business from takeovers.
SWH said at the time that it considered the move illegal. In March a Swiss court denied a request by SWH to lift the limitation of its voting rights.
As MRC informed before, Sika AG reported a 28% increase in annual profit as the Swiss construction and industrial chemical maker continues fending off a hostile takeover bid from France's Saint-Gobain SA.
Sika is a specialty chemicals company with a leading position in the development and production of systems and products for bonding, sealing, damping, reinforcing and protecting in the building sector and the motor vehicle industry. Sika has subsidiaries in 90 countries around the world and manufactures in over 160 factories. Its more than 16,000 employees generated annual sales of CHF 5.6 billion in 2014.
MRC