Switzerland's Sika is Still Battling Saint-Gobain Takeover
December 04 2015 - 5:10AM
Dow Jones News
ZURICH—Swiss construction and automotive chemicals maker Sika AG
has repeated its opposition to its takeover by French building
materials giant Saint-Gobain SA, a year after the bitter $2.76
billion takeover battle began.
Sika Chairman Paul Hä lg has written an open letter to
Saint-Gobain shareholders saying the planned takeover, which was
first announced on Dec. 8 last year, would destroy value at both
companies.
"The intended transaction lacks industrial logic and will
destroy value for all shareholders," Mr. Hä lg wrote in the
letter.
A spokesman for Saint-Gobain declined to comment on the
letter.
The takeover has proved controversial because Paris-based
Saint-Gobain has proposed only to buy the 16% stake held by Sika's
founding Burkard family for 2.75 billion Swiss francs ($2.75
billion). Buying the family's investment vehicle gives control of
Sika as it has 52% of the voting rights in the Swiss company.
Baar-based Sika has responded by limiting the family's voting
rights to 5%, a move which is now being disputed in Swiss courts,
with a decision expected in the middle of next year.
"Twelve months after the announcement of the intended
transaction there is still no end of the conflict in sight," said
Mr. Hä lg.
Mr. Hä lg said cost savings expected by Saint-Gobain were
unrealistic, especially as the two companies are in direct
competition in the mortar business. The cash return to Saint-Gobain
shareholders would also be minimal, he said.
Sika, which makes chemicals used to reinforce concrete and
soundproof of cars, would also be damaged by a takeover, while many
Sika managers have raised concerns about a transaction, he
added.
"With the support of the entire management team, employee
representatives and virtually all of the public shareholders, the
non-conflicted board members will continue to act in the best
interest of Sika and, therefore, oppose the intended transaction,"
wrote Mr. Hä lg.
Write to John Revill at john.revill@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
December 04, 2015 04:55 ET (09:55 GMT)
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