Boardroom battle sees Kuoni shares dip
Shares in the travel group, Kuoni, fell by six per cent on the Swiss Stock Exchange on Monday as investors gave their verdict on the ongoing boardroom power struggle ahead of Tuesday's Annual General Meeting.
Shares in the company lost SFr44 ($23) to trade at SFr701 at the close of business, down from a year-high of SFr795 reached in March.
The battle for control of the company broke out just over a week ago when five of the eight board members demanded the resignation of the chairman, Daniel Affolter. They accuse him of awarding himself payments of millions of francs from the Kuoni and Hugentobler foundation which holds 25 per cent of the company's voting rights.
The board is also filing criminal charges against Affolter for "disloyal conduct of business".
Similar charges have been levelled at Alfred Kuoni, who set up the foundation in 1957 to try to ensure the company's independence.
The board says it is concerned that the foundation, which practically controls Kuoni, had been entrusted to people who were placing their personal interests above those of the company, its staff and shareholders.
Although the row broke out too late to make it on to the agenda of Tuesday's AGM, the meeting should give an indication of shareholder sentiment towards the two camps. An extraordinary shareholders meeting in July should decide Affolter's fate.
Affolter suffered a setback on Friday when the authorities' supervising foundations in canton Zurich said the Kuoni and Hugentobler foundation had to vote in line with proposals recommended by the Kuoni board, or abstain.
This led to Affolter's resignation as head of the foundation, though he insists he will stay on as chairman of the company.
He accuses his opponents, including the group's chief executive Hans Lerch, of trying to oust him and to soften up Kuoni for an outside takeover.
In a further twist on Sunday, the Kuoni and Hugentobler foundation itself launched proceedings against the company's vice-president, Heinz Müller.
Papers were lodged in Zurich accusing Müller of breaching commercial secrets and suppressing information.
It's not entirely clear who will lead Tuesday's AGM. Müller has said he will preside but he may face a challenge from Affolter who argues that only shareholders can remove him.
by Michael Hollingdale
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