Institutions may go to court to resolve Astec buyout dispute
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.An acrimonious boardroom split at Astec (BSR), the power supply manufacturer, intensified yesterday after two leading shareholders revealed they were considering going to court to resolve a dispute over future control of the company.
Royal & Sun Alliance and Electra Fleming, two of the company's biggest institutional investors, stepped up the pressure on Emerson, the US engineering giant which controls 51 per cent of Astec. Emerson astonished non-executive directors of Astec last month when it announced plans to buy out minority investors, remove three executive directors from the board and stop paying out dividends.
The two shareholders last night said they were "considering court proceedings" against Emerson under section 459 of the Companies Act, which deals with attempts by big investors to prejudice the interests of other shareholders.
In a statement Royal & Sun Alliance, which speaks for just over 5 per cent of Astec, added that Emerson was "considered to be influencing the affairs of the company to the detriment of other shareholders."
The institution cited the move by Emerson to call an extraordinary shareholders' meeting to approve the changes. Last month 18 institutions put their names to a letter condemning the plans as a "blatant disregard" of their interests.
The news came after independent directors of Astec opposed to Emerson's plans yesterday called on shareholders to consider the legal position.
The directors, led by deputy chairman Peter Marshall, who was deputy chief executive of the former Plessey electronics and defence business, said dissident directors were prevented from going to court themselves under company law.
Although Emerson has not launched a formal offer to take full control of Astec, it outlined an indicative bid to buy the shares at the current market price, which yesterday fell 0.5p to 124p.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments