ZURICH, Oct 23 (Reuters) - Aryzta’s row with its largest shareholder, Cobas Asset Management, deepened on Tuesday, with the investor accusing the Swiss-Irish baking company of painting “an unduly grim picture” of its financial situation to ram through a disputed capital hike.
Last week, Aryzta stood by its plan to raise 800 million euros ($916.24 million) in new equity to meet its liquidity and financing needs, criticising Cobas’ counterproposal to raise only half that amount as inadequate and risky.
Spain’s Cobas, which has a 14.5 percent stake in the maker of McDonald’s hamburger buns, favors a 400 million euro capital increase and the sale of non-core assets it contends could raise a further 250 million euros.
Cobas on Tuesday expressed disappointment, saying Aryzta Chief Executive Kevin Toland has not engaged shareholders as the company seeks to raise new money to cut debt and strengthen its balance sheet. The baking company is reeling from a failed expansion strategy that has led to hundreds of millions of euros in losses.
“We believe that the company now is drawing an unduly grim picture of the current situation with the sole intent to convince shareholders to support the excessively large and dilutive capital increase,” Cobas said in a statement.
Aryzta did not immediately respond to a request for comment.
Proxy adviser ISS had originally opposed the capital increase but on Friday changed course and said that it now backed the plan. ($1 = 0.8731 euros) (Reporting by John Miller; Editing by Sunil Nair)