FRANKFURT (Reuters) – Shareholder advisor Ivox Glass Lewis has known as on Linde (DE:LING) investors to election against signing off around the actions of their management and supervisory board because of problems within the handling of the planned merger with peer Praxair (N:PX).
The all-share merger of equals would reunite a worldwide industrial gases company that split in World War One and would produce a market leader to rival Air Liquide (PA:AIRP).
However the $65 billion deal has faced suddenly strong opposition from trade unions, who fear a dilution of the influence and enormous-scale job losses, in addition to scepticism from investors.
Rash management changes throughout the negotiations with Praxair this past year, a row with a few shareholders over the possible lack of a election around the merger, and powerful opposition in the labor side towards the deal have elevated doubts about best governance, Ivox Glass Lewis stated.
Choice advised shareholders against ratifying the choices through the company’s bosses and it is supervisors.
Such votes on mergers are customary in Germany and therefore are an chance for shareholders to convey confidence within their leadership. But such votes don’t free individuals from liability for his or her actions.
Many investment funds in the U . s . States and Britain stick to the recommendations of advisory firms for example Ivox Glass Lewis at shareholder conferences.
Fund manager Ingo Speich from Union Investment, certainly one of Linde’s top 15 investors, stated he wouldn’t ratify the moves through the company’s management.
“We don’t call the commercial logic from the merger into question. But we criticize deficits in corporate governance and capital markets communication,” he told Frankfurter Allgemeine Sonntagszeitung.
“(Chairman) Wolfgang Reitzle appears is the driving pressure from the merger. But he functions within an intransparent way. We miss a obvious distinction from the roles of management and supervisors,” he added.
The 2 companies had wished to possess a plan in position before Linde’s annual shareholder meeting on May 10. However the deal has fallen behind schedule within the Linde management’s lack of ability to strike an offer using the employees.