Court Backs Sika Board on Family Voting Rights in Saint-Gobain Fight

By John Revill

ZURICH--Sika AG has scored a success in its battle to fend off a $3 billion hostile takeover bid by France's Saint-Gobain SA, after a Swiss court upheld a decision to limit the voting rights of the founding family.

The superior court in the Swiss canton of Zug denied an appeal by the family's investment vehicle Schenker-Winkler AG to have its full voting rights restored--a condition for its sale to Saint-Gobain.

Construction materials company Saint-Gobain wants to take control of Sika by paying 2.75 billion Swiss francs ($2.94 billion) for SWH, which owns just over 16% of the share capital but controls 52% of the voting rights in Sika.

The superior court on Thursday confirmed an earlier ruling of a lower court, which backed Sika's board's decision to limit SWH voting rights to 5%.

The court decision is the latest round in a stormy takeover battle which erupted last December when Saint-Gobain announced its intention to take over Sika, a Baar-based company which makes chemicals used in the automotive and construction industry.

SWH can still appeal the decision at the Swiss Federal Supreme Court, the highest judicial authority in Switzerland. The family also has other legal proceedings underway, said an SWH spokesman, who declined to comment on the latest court decision.

The family had wanted to sell its stake, but the deal was met with opposition by shareholders because the offer wasn't extended to them, while Sika's board said the deal didn't make business sense.

"This is an important day for Sika and our battle against Saint-Gobain," a Sika spokesman said. "The board welcomes this decision and shall analyse it in detail."

A spokeswoman for Saint-Gobain said the company regretted the court's decision, but remained committed to taking control of Sika by buying SWH.