Vulture’s court battle to force out Dulux boss

3,300 UK jobs at risk as hedge fund pushes for takeover

THE battle for Dulux will reach a crescendo this week as Dutch courts decide whether to allow US vultures to take steps to oust the paintmaker’s chairman.

Hedge fund Elliott, owned by billionaire Paul Singer (pictured below), has been calling for the dismissal of Antony Burgmans, the chairman of parent firm Akzo Nobel, after it rejected three takeover bids from American rival PPG.

The Pittsburgh-based firm has been trying to acquire Akzo since March, but has had three bids of £18.1bn, £19.3bn and £22.5bn rebuffed.

It is feared that a US takeover could put at risk the jobs of 3,300 Akzo workers in Slough and the East Midlands.

Under Dutch law, shareholders representing more than a 10pc stake in a company have a right to call an extraordinary general meeting. But Elliott, which had assembled a group of investors to meet the threshold, had its calls to oust Burgmans rejected at Akzo’s annual general meeting last month. Akzo claimed the law did not give shareholders a right to call EGMs, but rather a right to request them. It dismissed Elliott’s demand as ‘irresponsible, disproportionate, damaging and not in the best interests of the company’. Elliott then took its case to the Amsterdam Enterprise Chamber to force the company’s hand. The activist, along with six of Akzo Nobel’s top investors, will give evidence against the company’s board today, asking the court to call an extraordinary shareholders meeting and order an investigation into Akzo’s performance.

Most of the senior shareholders making their case known – including Templeton Investment, Tweedy Browne, Universities Superannuation Scheme, Dodge & Cox, Intrinsic Value Investors and York Capital Management – have already publicly criticised Akzo. Elliott’s efforts to call an EGM, however, could fall short even if Akzo is required to hold one because it is now not certain that PPG will continue its pursuit of the Dulux owner as it has already hinted it may walk away from the bid.

Elliott also took another swipe at the world’s largest mining company, BHP Billiton.

The investor demanded that the firm dismantle its Singapore offshoot, which is currently at the heart of a £570m dispute with the Australian tax authorities.