FRANKFURT: German generic drugmaker Stada said on Sunday it would propose three new independent directors to join its supervisory board, countering nominations from investor Active Ownership.
The Luxembourg-based activist investor, which holds 5 percent of Stada and about another 2 percent via stock options, had initially sought to oust board chairman Martin Abend and install five of its nominees on the board, saying it wanted to add international expertise to help Stada realise its potential. Stada and Active Ownership appeared to reach a compromise last week, in which the investor would seek to replace only three candidates and leave Abend in place.
But Stada on Sunday issued a statement saying a committee of its current supervisory board would now nominate three independent candidates. It postponed its annual shareholder meeting to give the committee time to find nominees.
Stada shares have surged 19 percent this month on speculation Active Ownership’s campaign could lead to a sale or break-up of the company.
Active Ownership had wanted Klaus-Joachim Krauth, former finance chief of drugmaker Hexal; Ulrich Wandschneider, until recently chief executive of hospitals chain Asklepios Kliniken; and Active Ownership founding partner Klaus Roehrig to join Stada’s supervisory board.
It had said they should replace Eckhard Brueggemann, Arnold Hertzsch and Constantin Meyer.
A Stada spokesman said Active Ownership’s proposal was now “formally off the table”, without elaborating.
Active Ownership did not immediately respond to a request for comment. Stada said in a statement: “The supervisory board’s nomination committee will place particular emphasis on the potential candidates’ relevant expertise and experience in the fields of generic pharmaceuticals and OTC (over-the-counter) products, their expertise in finance, audit and legal matters as well as on their personal independence.”
“Upon Stada’s request, the three candidates named in advance by Active Ownership Capital have advised that they will need a reflection period to consider taking part in the selection process,” it added.
Active Ownership’s other key demand, to cancel the limited transferability of registered shares, will remain on the agenda of Stada’s annual shareholder meeting – which will now be held on Aug. 26 instead of June 9.
Currently, such so-called “vinculated shares”, under German securities trading laws, can only change hands with the consent of top managers or otherwise the shares lose their voting rights.
Copyright Reuters, 2016
Courtesy : BRecorder