EQS Group-News: Dynamics Group AG
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Shareholder group around Sentis Capital responds to arguments of Meyer Burger Board of Directors regarding rejection of shareholder representative
According to Swiss company law, the Board of Directors is responsible for determining the corporate strategy and not the CEO. As Chairman Lütolf assured in personal discussions, Meyer Burger's Board of Directors is leading the implementation of the new strategy. Meyer Burger also has many highly qualified and motivated employees and managers who are of greater importance to the successful implementation of this new strategy than the CEO. The CEO's threat of resignation therefore poses no threat whatsoever to the implementation of the new strategy.
By threatening to resign, Dr. Brändle has put the company, its employees, its shareholders and the Board of Directors in an unfavorable position. Due to the statutory duty of care, the Board of Directors is required to react immediately to the threat made and to start searching for suitable replacement candidates now - if Dr. Brändle acts in accordance with his threat on 30 October.
In general, the Board of Directors must consider whether a CEO, who puts pressure on the Board of Directors and shareholders with threats, is acceptable - and whether its threat is a viable main argument against the election of Mark Kerekes as an individual shareholder representative.
This would contradict the principles of stock corporation law and good corporate governance. The threat of resignation by Meyer Burger CEO Dr. Brändle to prevent a single shareholder representative on the Board of Directors is therefore incomprehensible and a unique incident. It is an attempt to exert pressure that is inadmissible and runs counter to established practice: The General Meeting - not the CEO - elects the Board of Directors.
Both members of the Board of Directors and members of the Executive Board questioned Mr. Kerekes several times in personal discussions. Each time they attested him a profound understanding of the photovoltaic industry. Mark Kerekes is an experienced investor and analyst of industrial and technology companies. The reservation of a lack of experience is wrong.
Stefano Landi, long-time President of the Reggio Emilia Chamber of Commerce and Industry and President of Landi Renzo SpA (LR:IM) says of Mark Kerekes: "I have known Mark for almost 10 years He is a very analytical investor and analyst. He can be tough and direct in conversations and on the job, but for him the well-being and success of the company always comes first".
With the election of Mark Kerekes to the Board of Directors of Meyer Burger, the Board will be enriched by ownership perspective and many years of capital market experience, which the board of directors is lacking at the moment. The current share price and the price of the convertible bond show that Meyer Burger has lost the confidence of the capital market. This must be regained as quickly as possible. Mark Kerekes will be able to make a significant contribution in this regard.
Meyer Burger's fundamental opposition to the election is also incomprehensible in view of the fact that Mark Kerekes will only be one of five members of the Board of Directors. If the Board does not agree with Mark Kerekes, the Board will overrule him. It is incomprehensible that the Board of Directors wants to prevent the mere participation of a shareholder representative.
Contrary to the Board of Directors' assertions, there can be no conflict of interest with Mark Kerekes, as both the Board of Directors and the shareholders consider the well-being and success of the company to be paramount.
The shareholders have invested their money in Meyer Burger because they believe in the future of the company and want to increase its value. In 2016, Sentis helped to save Meyer Burger from bankruptcy as a long-term and largest shareholder. Sentis was not only the largest investor, but also participated in the underwriting of the capital increase that secured the company's survival.
As far as the secrecy of Meyer Burger's internal information is concerned, Mark Kerekes will comply with the law and stock corporation law.
He would not be the first shareholder nominated board member in Switzerland. Numerous other examples in Switzerland, such as ABB, Ascom, Comet or Calida, prove that the doubts cast by Meyer Burger are tantamount to an unfounded prejudgment. Mark Kerekes has always been a committed and reliable employee in his professional past who has always complied with his legal and contractual obligations - there is no indication that he will not comply with his duties at Meyer-Burger.
The fact that by far the largest minority group is awarded a seat on the Board of Directors is not only a justified concern, it also reflects international trends in contemporary corporate governance. In countries such as Italy and Portugal, this group of shareholders would even be legally entitled to at least one owner representative on the Board of Directors.
The Board of Directors' further allegation that Mark Kerekes cannot fit in is intrinsically false.
The Board appears to fear that Mark Kerekes will bring new ideas and perspectives to the Board. However, it is precisely in the spirit of the Board that not only one opinion - dictated by the Chairman or the CEO - prevails, but different opinions are expressed and discussed. Different perspectives and a diversity of opinions are indispensable for the quality of the strategic leadership work on the Board of Directors. The argument that Mark Kerekes would disrupt the unity of the Board is self-denying. Given the company's results to date and the share price performance, it is of utmost importance that the Board listens to different opinions.
The allegation that the election of Mark Kerekes would expose Meyer Burger to the risk of sanctions is false. Petr Kondrashev is not on any sanctions list, nor has he ever been affected by sanctions. Sentis Capital is also not a majority owner of Meyer Burger. Therefore, the sanction risk invoked by Meyer Burger can never arise. This, too, is an unfounded prejudgment. The idea that Sentis Capital and its owner Petr Kondrashev pose a threat also comes rather late to the Board of Directors: When it came to saving the company in 2016, the Board of Directors accepted the money of its company without ifs and buts and with gratitude. This alone shows that the assertion of the danger of sanctions is unfounded.
Members of this shareholder group and even Petr Kondrashev himself have already refuted the false allegations published by the Board of Directors in numerous discussions, letters and emails with the Board of Directors prior to this Annual General Meeting.
The candidate Mark Kerekes was virtually interrogated by Meyer Burger's Board of Directors in an intensive hearing lasting several hours. The personnel consultant mentioned by Meyer Burger was only active on a protocol basis. Mark Kerekes was confronted with all these allegations and prejudices. He had already refuted them during the interview. Why Meyer Burger nevertheless repeats these false allegations publicly is a mystery.
It is incomprehensible why Meyer Burger uses such intensive effort and great corporate resources to prevent a single shareholder representative on the Board of Directors.
Especially against the background of the extremely poor performance of the company and the disappointment of the shareholders with the share price development, the Board of Directors should concentrate on shaping the future of the company positively and, together with the shareholders, ensuring the existence and success of the company. This alone is the goal of Mark Kerekes and the group of shareholders who proposed him as a member of the Board of Directors.
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Dynamics Group AG
Document title: Sentis_Gegenargumente_MBT_30.9.2019
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