Methanex Settles Dispute with Shareholder
Methanex has settled a dispute with major shareholder M&G Investments, ending the prospect of a proxy fight at its upcoming annual general meeting.
The Canadian methanol producer has agreed to recommend M&G nominee Paul Dobson for election to its eleven member board of directors at the meeting on Apr. 25. Dobson, who will be appointed to the Audit, Finance and Risk Committee, is acting CEO (and former chief financial officer) of Hydro One, a Canadian electricity distribution and transmission company.
To accommodation Dobson’s appointment, independent director Howard Balloch has offered to stand down from re-election and bring his planned retirement forward by a year.
“We are pleased to have come to a cooperation agreement with our largest shareholder that is both responsive to their views and allows us to move forward with our mutual goal of maintaining Methanex’s leading position in the methanol industry while generating strong returns for shareholders,” said Methanex chairman Tom Hamilton.
John Floren, president and CEO of Methanex, added that as part of the deal, the company will retain an independent advisor to assist in the financial review of the Geismar 3 project. It was Methanex’s refusal to rule out proceeding on its own with the project on the Louisiana Gulf Coast that upset M&G. Going solo would represent an unacceptable financial risk and one too large for Methanex to bear alone, the shareholder said.
Methanex has also pledged to select another director with financial experience after the agm from a list to be submitted by M&G as part of an ongoing process to refresh its board.
For its part, M&G has agreed to vote in favor of the nominees recommended by Methanex; it has also agreed to a standstill arrangement through the 2020 general meeting.