Meyer Burger resists rebel shareholder at EGM

The Swiss solar equipment supplier today fought off an attempt by its largest single shareholder to have a representative appointed to its board and to have its executive pay regime reviewed. Victory in that battle may secure the company some wiggle room, but the war over corporate strategy appears far from over.

October 30, 2019

The board of embattled Swiss solar manufacturing equipment supplier Meyer Burger today fought off an attempt by an activist shareholder group to have a representative appointed as a director.

The Thun-based company had arranged an extraordinary general meeting (EGM) to vote on the proposed appointment of Mark Kerekes to the board and, if the appointment were approved, to review executive pay.

Kerekes is joint chief executive of Sentis Capital PCC, the single largest investor in Meyer Burger and a shareholder which has been a thorn in the side of the equipment maker’s board since its call for the company to develop its own next-generation solar module production facility appeared to fall on deaf ears last year.

In December, Sentis Capital – which at the time reportedly held a 6% stake in Meyer Burger – suggested the board borrow sufficient funds to develop a 5-10 GW annual production capacity fab to produce and sell its own heterojunction (HJT) and tandem solar cell modules.

The Sentis solution

Sentis argued global module makers were put off investing in Meyer Burger’s production equipment because of the high cost and the risk that the estimated $0.07/Wp financial benefit the technology would bring would be wiped out as soon as rivals purchased the same tech.

Why not, Sentis argued, develop Meyer Burger’s own production capacity and bank the exclusive benefits? The rebel shareholder suggested the Meyer Burger board might seek a partnership to set up a module factory, although that appeared to be its least preferred option, given the threat it might pose of liquidating the holding of shareholders like itself.

The board of Meyer Burger appeared to balk at the thought of taking on more debt at a time when its profit margins in China were getting ever thinner. The subsequent decision, in August, by chief executive Hans Brändle to row back on plans for the Swiss company to relocate some of its manufacturing and sales functions to China appeared to incense Sentis, which had been enthusiastic about that strategy and will have undoubtedly noted the recent bumper orders from the Far East announced by German rival RENA Technologies.

What was the vote tally?

The board of Meyer Burger finally bowed to Sentis’ demand to vote on whether to appoint a representative of the shareholder to the Meyer Burger board and, with 391 shareholders attending today’s EGM, a “clear majority” voted against the proposition.

Brändle and recently appointed Meyer Burger chairman Remo Lütolf may feel vindicated in their wish to pursue a high-quality, Europe-focused strategy based initially on supplying HJT and SmartWire products to Norwegian developer REC Solar, and on commercializing perovskite-solar tandem solar cells with Anglo-German company Oxford PV.

However, the fact the press release issued by Meyer Burger today to announce the result of the vote did not specify exact numbers would hint the shareholder rebellion may have been substantial.