July 14, 2022 | Editor: Martin Wennerström
SEC rescinds proxy advisory restrictions
The U.S. SEC has voted to rescind Trump-era rules covering proxy advisers, in a move that is meant to facilitate the “timeliness and independence of proxy voting advice.” Once the change comes into force, issuers would no longer be entitled to preview recommendations ahead of publication or to have their written responses automatically disseminated to proxy advisory clients. In addition, certain text relating to advisers’ liability for material misstatements and omissions will be stricken, reportedly to eliminate confusion while reaffirming that proxy advice is indeed subject to legal liability. Proxy adviser Institutional Shareholder Services has described the changes as insufficient, while industry group The National Association of Manufacturers has threatened suit to “protect manufacturers from proxy advisory firms’ outsized influence.”
SEC (1) | SEC (2) | SEC (3) | NAM | Reuters (1) | Bloomberg (1) | Bloomberg (2)|
GSK shareholders approve Haleon demerger
GSK shareholders voted to approve the spin-off of its consumer healthcare business, Haleon. The new company will begin its listing on the London Stock Exchange starting July 18, with an expected valuation of between GBP 38 to 45 billion. Earlier this year, GSK rejected Unilever’s GBP 50 billion purchase offer. Following the demerger, Pfizer will maintain its 32% stake, while GSK will own around 6% of its shares. GSK shareholders will own more than 54% of Haleon’s shares. Brian McNamara will continue as CEO, while GSK’s Chairman Dave Lewis will serve as non-executive Chairman. Two Pfizer-nominated directors will also join the board.
Guardian | Fierce Pharma | GSK|
Berkshire Hathaway increases its stake in Occidental Petroleum
Berkshire Hathaway has increased its stake in Occidental Petroleum to 18.7%, after starting to acquire shares in March 2022. The company could increase its ownership to 25% if it were to keep stock warrants representing around 9% of Occidental’s shares. Berkshire’s recent acquisitions of Occidental stock prompted speculations over Warren Buffett’s intention to acquire the oil company, however the company did not respond to inquiries regarding its purchases. If Berkshire were to increase its stake to more than 20%, it could consider a change in accounting and record the proportionate share of earnings in its own profits.
Reuters | Business Insider | S&P Global |
Orpea reshuffles board in wake of nursing home scandal
Orpea’s July 28 AGM will vote on the appointment of five new board members, including newly appointed CEO Laurent Guillot as director and former French state railway CEO Guillaume Pepy as board chairman. The changes come amid scrutiny over the eldercare home operator’s business practices, including allegations of neglect and a tiered rationing of services. According to the company, an external audit revealed evidence of financial misconduct while failing to substantiate all the allegations against the company. The care home firm also confirmed that French police raided its headquarters but declined further comment.
Governance in Brief – June 1, 2023
Citigroup to IPO Banamex after Mexican gov’t interventions hamper sales deal Citigroup has announced a plan to spin off its Mexican business, Banamex, after a failure to sell the unit to conglomerate Grupo Mexico. Citigroup had been in talks with German Larrea, CEO and Chairman of Grupo Mexico, for over a year in an attempt to orchestrate the sale of the bank, which was first announced at the start of 2022.
Governance in Brief – May 25, 2023
Activist investor pushes for leadership and strategy changes at NRG Energy Activist investor Elliott Investment Management has disclosed a 13% stake in the US-based NRG Energy and called for leadership and operational changes at the company to remedy its “meaningful underperformance.” The investor urged NRG to add independent directors with experience in the power and energy sector to its board, noting that it has already identified five executives to guide the operational and strategic changes.
Governance in Brief – May 19, 2023
EU court sides with Ryanair on Lufthansa’s 2020 bailout. The EU General Court, the second-highest court in the EU, has annulled the European Commission’s decision on the approval of state bailout for Deutsche Lufthansa prompted by the 2020 pandemic. The judgment found the EC erroneously considered that Lufthansa could not obtain financing on the markets and failed to ask for the implementation of an incentive mechanism for the airline to buy back the German Government’s stake.
Governance in Brief – May 11, 2023
JPMorgan Chase takes over failed First Republic Bank JPMorgan Chase has acquired the assets and deposits of First Republic Bank after California authorities seized and auctioned the troubled lender. The Federal Deposit Insurance Corporation (“FDIC”), an independent governmental agency established to maintain financial stability through the insurance of banks’ deposits, took possession of First Republic Bank after the lender suffered a severe liquidity crisis following the failure of SVB and Signature Bank earlier in March.