Sika AG prevails in protracted shareholder challenge

Sources: Sika AG, Baar, Switzerland; CP staff

The Swiss parent of Sika Corp. has settled a three-and-half-year legal dispute with glass and building materials giant Saint-Gobain of France through transactions involving founding family members’ shares, plus proposed board measures altering governance and share classes.

Citing conflict of interest concerns and fiduciary obligations, Sika AG directors contested a late-2014 transfer of the Burkhard family’s stake—equating to 16.1 percent of shares, vested with 52.4 percent of voting rights—to Saint-Gobain. Legal challenges attempting to block Saint-Gobain proceeded through Swiss agencies and the European Commission. Under an agreement announced May 11:

Saint-Gobain has acquired Schenker-Winkler Holding AG, a Burkard entity encompassing Sika shares, for $3.2 billion; sold Sika AG shares representing a 6.97 percent stake for just over $2 billion; and, retained a 10.75 percent Sika AG stake, combining SWH and separately acquired shares.
Sika will convene a June shareholders meeting where directors seek approval to cancel shares acquired from Saint-Gobain/SWH, thereby increasing remaining shares’ value; convert all shares to a single class, based on a “one-share, one-vote” principle; and, eliminate stock transfer provisions underpinning Sika’s initial legal challenge.

“This solution is immediately accretive for our shareholders and paves the way for a new chapter of our success story. The introduction of a modern governance structure will provide Sika with a solid base to accelerate its growth,” note Sika Chairman Paul Hälg and CEO Paul Schuler in a joint statement on the agreement with Saint-Gobain.