A majority of Magna International’s Class A shareholders have already voted to support the autoparts and contract assembler’s controversial plan to pay its founder a huge premium to loosen his control, a top executive has said.
Founder Frank Stronach, an Austrian immigrant who built the Aurora, Ontario-based conglomerate up from a one-man tooling business, stands to pocket US$863m in cash and stock in exchange for giving up his multiple voting shares and ceding control of the company, provided the plan gets approved by shareholders and regulators.
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About 54% of all outstanding shares, not including those held by insiders, have already been voted in favor of the proposed transaction, chief financial officer Vincent Galifi told an Ontario Securities Commission hearing, Reuters reported.
The regulator last week announced it would hold a hearing on the proposed share transaction after several institutional shareholders complained that Stronach would be receiving too high a premium to give up his controlling Class B shares.
Staff at the OSC had also noted that the company’s board had made no recommendation on the deal and that shareholders were not provided enough information, the report added.
