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CANADA: Another Stronach leaving Magna

By Graeme Roberts | 22 December 2010

Magna International has announced that founder Frank Stronach's daughter Belinda Stronach will resign from her role as executive vice-chair and board member effective 31 December.

Lead director Michael Harris said in a statement "The board wishes to express our sincere and deep appreciation to Belinda for the valuable contribution she has made to Magna over many years and we wish Belinda every success in the future."

The statement added, as previously disclosed, the nominating committee is reviewing board composition and has asked Russell Reynolds Associates to help search for potential future members including someone to take Stronach's place.

Last September, Magna said co-chief executive officer, Siegfried Wolf would leave on 15 November for a post at Basic Element and its machinery division OJSC Russian Machines, the parent company of Russian automotive OEM GAZ Group.

At the end of August, an Ontario appeals court ruled Magna's proposed buyout of founder Frank Stronach's controlling shares could go ahead. The deal had won approval from shareholders in July and received Ontario Superior Court approval in August but was appealed by a dissident group of shareholders who claimed the payoff to Stronach was unreasonable.

The deal was also to give Stronach control of a new electric car parts joint venture with Magna and four years of lucrative consulting fees.

Some shareholders had long complained about Stronach's control of the company, his "consulting fees," and his side projects, including the now bankrupt Magna Entertainment horse track and entertainment venture.

The day Magna announced the plan to pay off Stronach, several analysts raised their price targets for the company.

Frank Stronach to relinquish control of Magna International