Expert Corporate Governance Service (ECGS)
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AP Moeller Maersk, April 2nd 2019

In general, A.P. Møller - Mærsk (APMM) is in compliance with the Danish regulations relating to organisation and procedures of the Annual General Meeting.

Under ITEM C, although not legally required in Denmark, the board of directors and the executive management seek discharge. Under its guidelines, ECGS no longer approves discharge of the board of directors and/or executive management if there is no legal requirement for it. Since there is no such requirement in Denmark, ECGS recommends to OPPOSE.

Under ITEM E, the board of directors seeks authorisation to repurchase own shares. As the magnitude of the authority requested (up to 15% of share capital) exceeds ECGS' guidelines, ECGS recommends to vote OPPOSE.

Under ITEMS F1-F5, the (re-)election of the board of directors is proposed.ECGS has concerns over the aggregate time commitments of Mr. Niels Björn Christiansen (ITEM F.3) and proposed new nominee Mr. Marc Engel (ITEM F.5). Consequently, ECGS normally would have recommended opposition. However, considering that the proxy card does not permit this, it recommends abstention instead.

Under ITEM H.2, the board of directors seeks approval to demerge the Company's drilling activities (Maersk Drilling) as a separately listed entity under the name of The Drilling Company of 1972 A/S, and to distribute the shares to APMM's shareholders. As demerger consideration the shareholders of APMM will receive one share in The Drilling Company of 1972 for each series A or B of nominally DKK 500 (1:1) and two shares for each series A or B of nominally DKK 1,000 (2:1). As a matter of principle, ECGS is supportive towards corporate spin-offs as they give shareholders the ability to choose whether they will continue to be exposed to the 'integrated container logistics business' (APMM) and/or 'drilling and offshore activities' (The Drilling Company of 1972), if not they can simply sell their shares. In ECGS' view, the new company will furthermore have sufficient substance to operate on a stand-alone basis. Based on the analysis above, ECGS recommends to vote FOR the demerger plan.

A.P. Moller-Maersk A/S Series B

A.P. Moeller Maersk is an international shipping company. Co.'s operating segments are: Container shipping and related activities which include global container services, inland transportation, manufacturing and repair of containers and container depots, and logistics and forwarding activities; APM terminals; Tankers, offshore and other shipping activities which include tanker shipping of crude oil, oil products and gas, offshore drilling activities and operation of land rigs, supply vessel activities with anchor handling and platform supply vessels, ferry services and door-to-door transportation in Northern Europe; Oil and gas activities; Retail activity; and Shipyards and other activities.


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