Swiss Fat-Cat Nemesis Enters Sika Spat on Spurned Minorities

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Thomas Minder
Swiss politician Thomas Minder. Photographer: Andre Haefliger via Bloomberg

Sika AG’s battle to fend off a hostile takeover bid by France’s Cie. de Saint Gobain has found an ally in Thomas Minder, the Swiss politician who pushed through a “fat-cat initiative” imposing restrictions on executive pay.

Saint Gobain has offered an 80 percent premium for the Burkard family’s 16 percent Sika stake as those shares carry 52 percent of the Swiss adhesives maker’s voting rights. By using an opt-out clause in Sika’s statutes, the French company can gain control without making an offer to minority shareholders, who include the Bill & Melinda Gates Foundation Trust.

“I am bothered by the fact that minority shareholders didn’t get any offer for their shares,” Minder said in an interview at the headquarters of his herbal toothpaste maker Trybol AG in Neuhausen, near the German border. “I feel only sympathy for Sika’s board; ideologically I am on their side.”

Minder is joining the chorus of investors and politicians supporting the legal challenge mounted by Sika’s board to the takeover by Saint Gobain. Minder, who sits on parliament’s legal affairs committee, has submitted a one share, one vote proposal to the government that would undercut voting rights allowing families and other major shareholders to exert a disproportionate influence on some Swiss companies.

In the meantime, Sika’s board has restricted the voting rights of the Burkard family to prevent it pushing the deal through. A court in the Swiss canton of Zug is expected to rule next year on Sika’s move, which the family says is illegal.

Sika Shares

“I like this guerilla-style approach but I don’t think they are going to win this case,” Minder, 54, said. While the Burkard family, who have controlled Sika for more than 100 years, also need some protection, Minder said the takeover threatens the Swiss company.

“I am convinced that if Saint Gobain takes it over Sika will be worse off,” he said.

Sika shares have dropped 12 percent since Saint Gobain made the offer to the Burkard family in December. The stock fell 3.1 percent to 3,422 francs as of 4:59 p.m. in Zurich.

Minder said his one share, one vote proposal could become part of a larger overhaul of Switzerland’s stock-exchange law.

Dual shares are common in Switzerland, with some stocks that pay dividends but don’t hold voting rights and others that do, allowing major investors to retain control. There are at least 10 Swiss companies where shareholders hold more voting rights than the equity they own, according to Ethos, a Geneva-based group that advises pension funds.

Minder spent five years collecting signatures to force a nationwide vote on executive compensation. His proposal -- that shareholders rather than company boards decide how much executives are paid -- was backed by 67.9 percent of voters in a March 2013 referendum.

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