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Swatch Group chairman, Nicolas Hayek, forecast sales would increase by between 10 and 12 per cent this year Keystone Archive

A boardroom power struggle at Switzerland's largest travel group, Kuoni, stole the business headlines this week. Five members of the board and the entire management called for the immediate resignation of the chairman Daniel Affolter.

This content was published on May 4, 2001 - 15:33

The board said on Friday it would file criminal charges for "disloyal conduct of business" against Affolter and the board of trustees of the Kuoni and Hugentobler foundation, which is the company's largest shareholder.

The foundation, created in 1957 by Alfred Kuoni, holds 6.25 per cent of Kuoni's capital and 25 per cent of voting rights.

The employment contract with Affolter, with its annual salary of SFr2 million ($1.16 million), was terminated.

The accusations against Affolter include the illegal payout of roughly SFr12 million to the board of trustees in 2000, with SFr8.1 million of this going to Affolter personally.

Affolter and Alfred Kuoni rejected the allegations at a news conference in Zurich. They said the one-off payments had been made legally for their performance at Kuoni over the years.

They accused the dissident board members of planning an attack on Kuoni's independence and suggested that insiders at Kuoni could be helping an outside company to take over the travel group.

With most traders off for Tuesday's May Day holiday, the week began rather slowly but the Swatch group stole the limelight on Wednesday at its annual news conference in Biel.

The chairman and chief executive, Nicolas Hayek, said that the Internet and jewellery would help the group to continue its strong growth curve. He forecast that sales would increase by between 10 and 12 per cent this year.

Hayek also launched an attack against stock exchanges. In particular, he said the Swiss exchange in Zurich had not done justice to his group's real value.

May Day brought some fresh changes to the Swiss business scene with the introduction of new legislation.

Swiss companies are now able to do away with minimum nominal share values. Previously a share had to have a value of at least SFr10 ($6) but the new law allows stocks to be valued at just SFr1.

The legislation brings Switzerland into line with a practice that has long been established in the United States and is increasing in other parts of Europe. It is aimed at improving market liquidity and broadening a company's shareholder base.

In another development, the former SAirGroup chairman, Eric Honegger, announced he was to leave his post on the board of directors of the Zurich-based German-language Neue Zürcher Zeitung (NZZ) newspaper.

One week after officially leaving his post as chairman of what is now the Swissair Group, Honegger was reported in the NZZ as saying he would not be presenting himself for re-election at Saturday's annual shareholders' meeting.

His decision to leave the NZZ board was forced by the controversy surrounding his one-year stint as Swissair chairman. In a letter addressed to NZZ shareholders, Honegger said that he wanted to avoid involving the media group in the ongoing debate surrounding the accounts at Swissair.

There was yet more news from the Swissair Group on Thursday when its chairman and chief executive Mario Corti said in the company's staff magazine that if productivity at Swissair increased fast enough, staff reductions could be restricted to voluntary redundancies or transfers within the group.

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