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Proxy Advisory Firm Glass Lewis Recommends Shareholders Vote FOR Two of Octavian’s Nominees to Balda’s Supervisory Board

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Proxy Advisory Firm Glass Lewis Recommends Shareholders Vote FOR Two of Octavian’s Nominees to Balda’s Supervisory Board Powered By Docstoc
					Proxy Advisory Firm Glass Lewis Recommends
Shareholders Vote FOR Two of Octavian’s
Nominees to Balda’s Supervisory Board
Second Independent Proxy Advisory Firm Expresses Serious Concerns About Balda’s Corporate
Governance

Says Balda’s Investors Have Reacted “Quite Favorably” to Octavian’s Proposals and “Believe a
Change to the Status Quo is Warranted”

January 25, 2012 03:03 PM Eastern Time 

NEW YORK--(EON: Enhanced Online News)--Octavian Advisors LP (“Octavian”), which through various funds
owns approximately 8.3% of the outstanding shares of Balda AG (“Balda”), today commented on a report issued by
independent proxy advisory firm Glass Lewis & Co. (“Glass Lewis”) recommending that Balda shareholders vote to
replace two members of Balda’s current Supervisory Board with Octavian’s candidates at the Extraordinary General
Meeting, which will be held on February 8, 2012.

“We are extremely pleased that now BOTH Glass Lewis and ISS Proxy Advisory Services have recommended in
favor of two of our nominees, René Charles Jäggi and Behdad Alizadeh,” said Richard Hurowitz, Chairman and
Chief Executive Officer of Octavian. “These two leading proxy advisory firms recognize the strength of Octavian’s
nominees as well as the obvious need for change on Balda’s conflict-ridden Supervisory Board. Our nominees are
fully committed to enhancing value and implementing enhanced corporate governance practices, and we are
confident that their leadership, experience, and excellent qualifications will be of great benefit to Balda and all of its
shareholders.” 

“Balda’s Supervisory Board members have repeatedly demonstrated that they have little interest in protecting
shareholders’ best interests,” said Igor Kuzniar, a Managing Director at Octavian. “It is our view that the entire
Supervisory Board must be replaced so that substantive improvements can be made as soon as possible.” 

Octavian respectfully disagrees with Glass Lewis’ recommendation to not vote for Mr. Kuzniar and vote against
removing Dr. Michael Naschke from Balda’s Supervisory Board. Octavian believes that Mr. Kuzniar, who is free
from conflicts of interests, has the necessary experience and skills to help a reconstituted Supervisory Board unlock
Balda’s value. Octavian also believes that Dr. Naschke does not have the necessary independence to act in the best
interests of Balda’s shareholders. Dr. Naschke was originally nominated to the Supervisory Board by Yield Return
Investments, the Chiang investment vehicle, and he has not been able to credibly demonstrate that he acts
independently and without influence from the Chiang family.

In its January 24, 2012 report, Glass Lewis stated:

About the Conflicts of Interests of the Current Supervisory Board Members

    l   “…we believe that Balda shareholders would be better served with a supervisory board that consists of a
        majority of members that are free from conflicts of interest with Mr. Chiang and TPK.” 
    l   “From a governance perspective, we agree with the Dissident that the supervisory board currently lacks
        sufficient independence from the Chiang family, the Company's largest shareholder.” 
    l   “Specifically, we note that Mr. Chen serves as the chairman and managing director of TVM Corporation,
        which is wholly owned by Mr. Chiang. Meanwhile, Mr. Kai serves as an adviser to TPK, where Mr. Chiang
        serves as co-founder and chairman and holds at least an 18.34% equity stake. In our view, the relationship of
        Messrs. Chen and Kai with Mr. Chiang raises significant concerns about the current supervisory board's
        ability to both act independently and take actions that are in the best interests of all Balda shareholders.” 
    l   “We believe that decreasing the size of the Company's supervisory board was particularly irresponsible in light
        of the board's overall lack of independence.” 

About the Supervisory Board’s Performance and Handling of Balda’s TPK Stake

    l   “…we find that the incumbent supervisory board has overseen a period of poor relative valuation and appears
        to be incapable of taking any meaningful board-level actions to remedy this issue.” 
    l   “…we find it difficult to believe that management has been unable to come up with more than one acceptable
        proposal over the past year to sell at least a portion of the TPK Stake.” 

About Mr. Michael Chiang and Mrs. Yun-Ling Chiang

    l   “The supervisory board argues that there is no conflict of interest because Yield Return, which holds 27.6% of
        the Company's common stock, is solely owned by Yun-Ling Chiang, Mr. Chiang's wife (as opposed to being
        jointly owned by both Mr. and Mrs. Chiang). However, we find the supervisory board's argument to be
        completely unsatisfactory here. Even if the entity in question is not directly held by Mr. Chiang, we believe it is
        reasonable to assume that Mrs. Chiang is acting in concert with her husband.” 

About Octavian’s Independent and Highly Qualified Nominees

    l   “In our view, both Messrs. Jäggi and Alizadeh have the requisite business, financial and board-level
        experience to serve on Balda's supervisory board.” 
    l   Specifically, Mr. Jäggi has over 35 years of management experience and currently serves on a number of 
        public and private company boards, while Mr. Alizadeh has over 20 years of experience in the financial
        services industry and had served as a director of Atos Origin SA and Valeo SA between 2008 and 2010.” 
    l   “It should also be noted that investors appear to have reacted quite favorably to Octavian's proxy contest…In
        our view, the Company's recent stock price movement likely suggests that investors believe a change to the
        status quo is warranted.” 

In order to rectify the current situation at Balda and improve corporate governance at the company, Octavian
Advisors is asking shareholders to replace the current Supervisory Board with three highly qualified and independent
candidates – René Charles Jäggi (Nomination as Chairman), Behdad Alizadeh, and Igor Kuzniar – who are firmly
committed to protecting the best interests of all Balda shareholders.

Octavian urges its fellow shareholders to vote FOR Octavian’s slate of directors at Balda’s Extraordinary General
Meeting on February 8, 2012 to ensure that the company has a Supervisory Board dedicated to maximizing value
for all Balda shareholders.

About Octavian Advisors

Octavian Advisors, LP is a global investment firm with offices in New York and London. The firm focuses on special
situations and distressed investments in international markets, and has successfully invested in over 40 countries on
six continents. Octavian currently manages approximately $1 billion for leading endowments, foundations, pension
funds, family offices and institutions.

Contacts
For Investors
Georgeson
Cas Sydorowitz, +44 (0)870-703-0302
shareholderinfo@georgeson.com
or
For German media
CNC – Communications & Network Consulting
Lasse Schmid, +49 89 599 458 142
Lasse.Schmid@cnc-communications.com
or
Nicholas Wenzel, +89 599 458 115
Nicholas.Wenzel@cnc-communications.com
or
For International media
Sard Verbinnen & Co
Jonathan Doorley, +1 212.687.8080
JDoorley@sardverb.com

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Description: NEW YORK--(EON: Enhanced Online News)--Octavian Advisors LP (“Octavian”), which through various funds owns approximately 8.3% of the outstanding shares of Balda AG (“Balda”), today commented on a report issued by independent proxy advisory firm Glass Lewis & Co. (“Glass Lewis”) recommending that Balda shareholders vote to replace two members of Balda’s current Supervisory Board with Octavian’s candidates at the Extraordinary General Meeting, which will be held on February 8, 2012. “We are ex a styl
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