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The business week in Switzerland

Sulzer shareholders rejected attempts to oust their board Keystone Archive

The virtual collapse of the hostile takeover bid for Sulzer Industries and more problems for the aviation conglomerate, SAirGroup, have been the main features of the business week in Switzerland.

This content was published on April 20, 2001 - 16:20

The takeover bid for Sulzer all but failed on Thursday when shareholders rejected a proposal to replace the company's current board with one proposed by InCentive Capital.

At a packed annual general meeting in Sulzer's hometown of Wintherthur, around 70 per cent of shareholders present decided to back the present chairman, Leonardo Vannotti, and his team.

In doing so, they foiled an attempt by InCentive's head, René Braginsky, to put the former ABB vice chairman, Eberhard von Koerber, in charge.

Along with the decision to reject Incentive's proposed board, shareholders also turned down a motion to scrap a five per cent restriction on voting rights.

Braginsky was counting on the success of such a move to have any chance of his SFr1.6 billion ($940 million) offer going through.

In a separate decision, shareholders also took the long-awaited decision to spin off the medical technology company, Sulzer Medica.

The troubled SAirGroup faced another headache on Wednesday after staff at the French airlines, AOM and Air Liberté, went on strike.

Unions had called on all staff to stop work and demonstrate in the centre of Paris over their concerns about the future of the two loss-making airlines.

The SAirGroup has a 49 per cent stake in both airlines, as well as a stake in a smaller French carrier, Air Littoral.

Europe's second biggest drugs group, Novartis, unveiled a 10 per cent increase in pharmaceutical sales over the first quarter of 2001.

Sales in its key division rose SFr4.5 billion underpinned by the performance of Novartis's range of new products.

In other corporate news this week, Zurich Financial Services said it would cut 460 jobs from its British life insurance arm as part of a restructuring programme designed to save around SFr160 million a year.

The company, formed through the merger of Switzerland's Zurich Group and British American Tobacco's financial services arm said most of the cuts would be achieved through natural wastage.

Two executives at Credit Suisse First Boston's New York office have reportedly been sent on leave amid a bribery investigation.

The federal authorities are investigating how shares in initial public offerings were awarded to clients. There are allegations that kickbacks may have been paid to dealers.

Switzerland's largest electricity producer, BKW of Bern, and 40 regional energy distributors launched a new name for their joint venture this week in preparation for the forthcoming liberalisation of the Swiss electricity market.

Under the company name of "Youtility", the partners want to sell electricity under the brand name "1to1 energy". The aim is to develop new products and to optimise their quality of service before the official opening up of the market.

by Michael Hollingdale

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