Dulux at war with New York fund over £19bn bid
THE battle for the owner of Dulux intensified yesterday as the company clashed with one of its biggest shareholders over a £19.4bn takeover bid.
New York hedge fund Elliott Advisors, which owns just over 3pc of Dulux parent Akzo Nobel, called for the paintmaker’s chairman to be removed after two takeover bids were rejected.
And last night it followed up by threatening to take legal action if Akzo did not give shareholders a vote to dismiss its chairman Antony Burgmans.
The threat of legal action came at the end of a dramatic day in which Akzo reported Elliott to financial regulators, accusing it of intending to share ‘potentially price sensitive information’ with PPG, the predator behind the bids.
The takeover bid from PPG has sparked fears over the future of 3,300 Akzo workers in the UK.
Dutch company Akzo acquired the paints and coatings division of ICI, the former UK industrial chemicals firm, for £8bn in 2008 and has staff in the north-east, Glasgow, Suffolk, the Midlands and at its Slough headquarters.
Akzo has been openly dismissive of PPG, saying a deal would lead to thousands of job losses worldwide.
It rejected two offers from the American firm, a £19.4bn bid last month and an £18.1bn bid a few weeks earlier. Now, the firm has called on Elliott to clarify its relationship with PPG after a leaked email suggested the two had been in close contact.
An email, seen by the Mail, sees Gordon Singer, son of Elliott’s billionaire founder Paul Singer, discuss the firm’s application to stage an extraordinary general meeting (EGM) to oust the Akzo chairman.
Singer writes to Elliott colleague Wiktor Sliwinski: ‘You should call PPG and let them know that we have sent the EGM request and that now may be an opportune time for PPG to reach out and try to engage.’
Akzo, made aware of the email after it was sent to a representative, said the note contained price-sensitive information.
This is because the fact that Elliott had written to Akzo calling for a shareholder meeting to remove Burgmans should have remained private until it was officially announced – meaning PPG had no right to know. Akzo has reported Elliott to the Dutch Authority for the Financial Markets. Elliott, which became a shareholder in December, refused to comment on the email. Instead it said: ‘PPG has met and communicated with Akzo Nobel’s top 20 shareholders; as one of the top 20 shareholders of Akzo Nobel, Elliott has therefore, as a matter of course, met and communicated with PPG.’
Elliott has been leading calls for Akzo to hold discussions with the US rival. It claimed yesterday that Akzo had failed to ‘genuinely listen’ to its concerns and it holds Burgmans accountable.
Elliott said it had won the support of shareholders for an EGM and has now asked Akzo to begin preparing the meeting, a process that takes eight weeks.
Akzo says the removal of Burgmans would be ‘irresponsible’ and has said it would respond to the EGM request within 14 days, as required by Dutch law.