Washington - Muslimchronicle
Dutch chemical giant AkzoNobel sought Friday to soothe shareholder jitters after a profit warning and a management shake-up including the surprise departure of its finance chief.
The announcements came as shareholders held an extraordinary meeting in Amsterdam to discuss next steps for AkzoNobel, the world's largest paintmaker, after its board rejected three multi-billion-euro takeover offers from main US rival PPG earlier this year, sparking a bitter legal tussle.
"We are here to have a dialogue with shareholders. Some agree and some disagree," AkzoNobel's chairman Antony Burgmans told the meeting at an upmarket hotel.
But Burgmans declined to comment when asked how AkzoNobel would react if PPG returned with yet another offer, or to give further details about changes to AkzoNobel's top management which also saw the departure of chief executive Ton Buchner.
Thierry Vanlancker has been appointed to take over as CEO from Buchner, who announced in July he would be stepping down for "health reasons". And shareholders on Friday approved Vanlancker as a member of the board.
AkzoNobel announced earlier Friday it would not achieve a 100-million-euro ($120.5-million) operating profit in 2017 as predicted in its first-quarter results in April.
The maker of paints such as Dulux and Trimetal blamed the shortfall on unfavourable currency rates and adverse market conditions, particularly in the marine and protective coatings sector.
It further announced unexpectedly that chief financial officer Maelys Castella was stepping aside also "due to health reasons" and would be replaced by an interim financial chief until a full-time replacement can be found.
- 'Inconvenient timing' -
Although AkzoNobel said Castella's departure was coincidental, analysts pointed out the timing was "surely inconvenient".
"The fact that they also now issued a profit warning due to a number of external and internal factors will seriously dent confidence that they will indeed reach their targets," Joost van Beek, an analyst at Theodoor Gilissen private bank told AFP.
"Obviously shareholders are concerned about these latest developments," one of them told the meeting.
Vanlancker admitted: "There are headwinds and challenges in the market."
But he added: "The reality remains for the company that in comparison to a number of other global players, profit remains behind by one or two points regarding return of sales."
"We will address that as quickly as possible ... by looking at increasing efficiency, simplifying structures and looking at concentrating on sales and marketing."
AkzoNobel's share price was slightly down at close on Friday afternoon on the Amsterdam stock market's AEX index, trading down 0.6 percent at 78.10 euros a share.
- 'Losing trust' -
AkzoNobel has been fighting a planned takeover by PPG which would have valued the Dutch company at 26.9 billion euros ($32.4 billion).
But in mid-August it announced it had buried the hatchet with activist investor group Elliott Advisors which was in favour of the tie-up.
Elliott, which holds a 9.5-percent stake in AkzoNobel, was angered by the Dutch group's rejection of three PPG takeover offers, accusing it of "losing the trust of shareholders" and creating "a crisis of confidence" in the company's management.
US-based Elliott instituted a number of legal cases against AkzoNobel to try to force its hand and oust Burgmans. Their attempts have so far been foiled by Dutch courts.
AkzoNobel and Elliot said in August they would suspend all litigation for at least three months.
Elliott will now also support AkzoNobel's plans to spin off its speciality chemicals business and the group's two new nominations to its supervisory board.
source: AFP