Sika: control tweaks
A court victory will not stop the use of two-tier share structures
Bad news for Swiss bigwigs. On Friday night, a cantonal court ruled that a controlling shareholder could not turf out those directors who had the temerity to oppose a sale that disenfranchised ordinary shareholders.
The Burkard family wanted to sell its stake in cement additives maker Sika — less than a fifth of the equity, but more than half the votes — to Saint-Gobain, a French construction products company. Sika’s directors argued that such a change of control requires a premium paid to all shareholders. The Burkards tried to remove the directors, who responded by invoking a provision in the company’s articles of association to restrict the family’s voting rights.
Such clauses are not universal so the ruling, subject to appeal, will not end the use of enhanced voting rights. Given this deal, agreed in 2014, remains in court should make other controlling shareholders think twice before trampling over minority rights.