Acerinox - AGM 21 October 2020
Acerinox previously called an AGM for 22 April 2020, however due to the pandemic, the Company decided to postpone the meeting until now. All items remain the same except the approval of the Second Long-Term Incentive (LTI) Plan and the authorisation to acquire the shares necessary for the compensation of the first cycle of the plan proposed in item 12. As well as the addition of items 14 and 15, regarding amendments in the Articles of Association and the AGM Regulations.
In light of COVID19, ECGS recommends that companies postpone decisions regarding dividend distribution in order to avoid liquidity and financial risks until the full effect of the pandemic can be assessed. Therefore, we advise shareholders to oppose items 5 and 6 regarding dividend distribution in December 2020 for FY 2019.
In item 9, the Board asks for the authority to issue fixed-income instruments, including convertible bonds, with the power to exclude pre-emptive rights for a total amount of up to €3 billion. We have concerns over the possibility to increase the share capital without pre-emptive rights by up to 50%, which largely surpasses ECGS' limit of 10%. Therefore, we recommend opposition.
In item 13, sharehold Remuneration Report. Concerns may arise over the lack of disclosure on the non-financial assessment metrics for variable remuneration. Moreover, the annual variable executive remuneration exceeds ECGS' limit of 150% and the overall variable remuneration depends more on short- that long-term results. Therefore, we recommend opposition.
Acerinox is the parent company of a group engaged in the manufacture and sale of flat and long stainless steel products, and stainless steel wires. Co.'s major products include slabs, billets, black coils, plates, hot-rolled coils, hot-rolled sheets, flat bars, hot-rolled re-bars, hot-rolled black bars, engraved sheets, cold-rolled coils, cold-rolled sheets and circles. Co. also provides long stainless steel products, such as wire rods, angles, hot rolled flat bars, hot rolled re-bars, reinforced bars in coils, cold rolled re-bars, hot rolled black bars, cold drawn bars, and smooth turned bars. In addition, Co. offers wires, welding wire bars, and bars for electrodes.
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