Ziggo to be acquired by Liberty Global - ECGS recommends to abstain from granting discharge to the Board

On August 26, 2014, Ziggo will convene an EGM to prepare the takeover of the company by Liberty Global. Within our recently issued report on the EGM, we recommended to oppose the discharge of the Board of Directors as we keep having concerns about the potential severance payment granted by the BOD to ex Ziggo's CEO, Mr. Obermman, who was appointed in 2014, when Ziggo was already entered in discussions with Liberty Global.

Ethos, the Swiss Partner of ECGS welcomes the revision of the Swiss Code of Best Practice for Corporate Governance but points out an ambivalent project

The Ethos Foundation commended the decision to carry out a revision of the Swiss Code of best practice for corporate governance. In the current Code dating back to 2002 (with an appendix added in 2007), several points do not reflect international best practice anymore.

ECGS supports Phitrust Active Investors new engagement campaign

Within a Press release disclosed in July, the active fund Phitrust Active Investors presented the themes of its new engagement campaign for 2014-2015. Two subjects will be brought for shareholders' engagement, the first one dealing with the new implementation of double voting rights in France within the framework of the "Loi Florange" allocating automatic double voting rights for holders of registered shares. Like Phitrust, ECGS considers that the law undermines the rights of minority shareholders and the principle of "one vote - one share".

BES rescued by the Portuguese State - Long term investors will be the only ones to bear the consequences of a disastrous governance !

by Sergio Carbonara, Frontis Governance

After having reassured depositors and investors over the financial solidity of Banco Espírito Santo (“BES”), the Portuguese Central Bank, Banco de Portugal, finally recognized the disastrous situation of the second largest private bank of the country, and on August 3rd decided to apply a resolution measure. The worse situation came out only on July 30th, when BES announced € 1.5 billion higher losses compared to the ones previously disclosed by the bank and its external auditor KPMG.

2014 UK companies’ return to shareholders: Vodafone, Rexam, Compass... Why ECGS does not always favour return of value in a first place.

by Emiliano Torracca

2014 has so far witnessed a number of UK Companies seeking to return value to their shareholders. Vodafone was the first to start the dance when in January sought approval for an unprecedented £54 billion return to its shareholders (representing approximately 105p per share) as a result of the disposal of its 45% stake in Verizon Wireless to Verizon for a consideration of $130 billion (£79 billion). Other companies such as Rexam and Compass followed Vodafone’s steps, seeking and obtaining shareholder approval for their respective returns to shareholders. Other UK listed companies sought to return value to their shareholders using alternative means.

The “Development Decree” allows Italian companies to issue multiple voting shares. A measure to support long-term investors or a new defense of major shareholders?

by Sergio Carbonara, Frontis Governance 

On 24th June 2014, the Italian Government approved the so-called “Development Decree”, introducing the possibility to issue multiple voting shares, waiving the principle of “one share – one vote”, so far one of the basis of the Italian market’s legislation.

Nokia's carving up continues - Ex CEO's unjustified severance payment maintained

A month after Nokia’s general meeting took place (June 17, 2014), Nokia once again hits the headlines. The announce is this time less gleaming, and does not concern a life saving operation.  Unfortunately, the ongoing carving up at the past Finnish mobile devices giant continues and Microsoft which has just acquired the company last April, has announced by the voice of his newly appointed CEO, Mr. Nadella, the biggest job cut-off in its history with 18,000 roles to be axed over the next year, of which 12,500 directly concerning Nokia’s devices and service businesses.

The multiple voting structure of the new Fiat-Chrysler is a clear breach of the basic principle of equal treatment of shareholders

by Sergio Carbonara, Frontis Governance

At the upcoming EGM of August 1st, Fiat’s shareholders will vote on the migration of the newborn Fiat-Chrysler Group from Italy to the Netherlands. The transaction is structured as a cross-border merger of Fiat SpA with and into its Dutch subsidiary Fiat Investments NV, which will be renamed Fiat Chrysler Automobiles NV (“FCA”). The new group will have the fiscal domicile in the United Kingdom, to pay lower taxes on dividends, and the FCA shares will be listed on the stock markets of New York and Milan. The transaction is very similar to last year’s merger of Fiat Industrial with CNH, which generated the Dutch company CNH Industrial.

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