Issue Date: September 15, 2008
Chemical Leaders In Jeopardy
IN A SWISS chemical drama, Clariant International CEO Jan Secher has been ousted, and an activist shareholder is seeking to force out Ciba Chairman Armin Meyer. The tumult has fueled rumors that Ciba and Clariant could merge or that Ciba might be a takeover candidate.
The shake-up in the Swiss specialty chemical industry began on Sept. 4 with Clariant's announcement that Hariolf Kottman will replace Secher as CEO on Oct. 1. Kottman has a Ph.D. in organic chemistry from the University of Stuttgart, in Germany, and is currently the member of SGL Carbon's executive committee responsible for advanced materials. SGL is a maker of graphite and carbon for electrodes and composites.
Clariant Chairman Juerg Witmer gave no specific reason for Secher's ouster other than to say "our objective is to substantially improve the performance of the Clariant group." However, Martin Schreiber, an analyst with the investment bank Zürcher Kantonalbank, says differences in strategic approaches led to Secher's break with the board.
Secher's replacement by Kottman, who now heads a small division of SGL, gave rise to rumors that Kottman will be a caretaker while Ciba and Clariant discuss a merger, Schreiber says. Some Swiss industry watchers, however, dismiss the rumors as idle chatter.
Ciba's stock price rose more than 10% after the Clariant leadership change. The rise was fueled not only by Ciba-Clariant merger speculation but also by rumors that Saudi Basic Industries, BASF, or even Dow Chemical might bid for Ciba. Then, on Sept. 8, activist investor Adriano Agosti, CEO of the Swiss investment firm GoldenPeaks Capital Partners, revealed he was pressing Ciba's board to replace Meyer, whose stint as CEO ended on Jan. 1. On that news, Ciba's stock rose another 10%.
Agosti, who says he wants a change in the company's culture, charges that Meyer has made poor strategic decisions and allowed operational inefficiencies that resulted in poor performance compared with industry peers such as Rohm and Haas, BASF, Chemtura, and Dow. A Ciba spokeswoman confirms that the board has talked with Agosti about Ciba's long-term strategy but declines to give further details.
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