UPDATE 2-Cable maker Nexans splits chairman, chief executive roles
* Top shareholder wants end to lock-up agreement
* AGM later on Thursday (Adds shareholders' comments, shares)
By Gilles Guillaume
PARIS, May 15 (Reuters) - French cable maker Nexans bowed to shareholder pressure for a management shakeup on Thursday and split chairman and chief executive Frederic Vincent's dual role.
Vincent will remain chairman while Chief Operating Officer Arnaud Poupart-Lafarge will take over as CEO, the company said.
Nexans also said its top shareholder, Chilean copper group Invexans, had asked to end the agreement that locks its holding at between 25 and 28 percent and gives it the right to appoint three board directors. Invexans owns 28 percent of Nexans.
The Chilean group said in a statement it was not seeking to take control of the French company and had no plans to cut its stake or increase it above 30 percent.
The statement came just hours ahead of the company's annual meeting, at which hedge fund Amber Capital plans to lead a rebellion against Vincent, having forced onto the agenda a resolution to dismiss him from the board citing underperformance since he took over in 2009.
"We welcome this totally unexpected change of tack by the board. It's up to shareholders to decide now," a spokesman for Amber Capital said.
Amber has 5.5 percent of Nexans and has won the backing of two major shareholder advisory groups, ISS and Proxinvest, for its resolution.
Nexans reported a loss in 2013 and skipped its dividend for the year after being forced to raise new capital in October, blaming a lack of growth in Europe and industry overcapacity.
Nexans has said Thursday's vote is a matter for shareholders. Until Thursday's decision it resisted Amber's call for a role split, noting that the combined structure is common in France.
Nexans said it would decide within eight days how to react to Invexans' request. Invexans is a holding company of the 70-year-old Chilean copper goods business Madeco, which in turn is controlled by the Chilean Luksic family's Quinenco.
Madeco became a shareholder in 2008 when it sold its own cables division to Nexans. Under the current shareholder agreement it must hold at least 25 percent of Nexans until Nov. 26, 2015, and not more than 28 percent.
The second- and third-largest shareholdings in Nexans belong to Manning & Napier Advisors, a U.S. value fund, and BPI, the French government investment vehicle, both with just under 8 percent.
BPI bought its stake in 2009 to "stabilise and reinforce" the company's shareholder base. BPI declined to comment on the resolution.
Nexans and Italian rival Prysmian are the dominant players in an industry that designs, produces and installs cables, mainly for the energy and telecom sectors.
Nexans is also in the crosshairs of a number of hedge funds betting on losses in its shares.
According to data from Markit, about 10 percent of Nexans' outstanding shares are on loan, making it one of the most shorted stocks on the French bourse.
Short selling involves selling borrowed shares in the hope of buying them back more cheaply later and pocketing the difference. Short-sellers usually target struggling companies underperforming their sectors.
Shares in Nexans, which had been briefly suspended from trading pending the statement, fell 0.14 percent to 42.94 euros by 1323 GMT. (Additional reporting by Andrew Callus, Blaise Robinson and Matthieu Protard; writing by Michel Rose; editing by Andrew Roche)
- UK says will pay off part of World War One-era debt next year
- Kurdish peshmerga forces enter Syria's Kobani after further air strikes |
- Oregon resident hospitalized for possible Ebola virus infection
- Fired-up Republicans have edge in midterm turnout war
- Test flight of Virgin Galactic spaceship ends in fatal crash in California |