Minority shareholder appeal against Magna dismissed by Canadian court
By APTuesday, August 31, 2010
Magna says shareholder appeal dismissed
NEW YORK — Magna International Inc. said Tuesday that an Ontario court dismissed a dissident minority shareholder appeal of a ruling approving Magna’s plan to eliminate its dual-class share structure.
The Canadian auto parts company said that since the group has indicated it will not appeal, Magna plans to implement the plan Tuesday. It includes redesignating Class A shares as “common shares” that will be traded on the Toronto and New York stock exchanges.
Magna announced the plan in May to eliminate its dual-class share structure in an effort to get founder Frank Stronach to give up his controlling stake. The plan included paying Stronach $1 billion in return for the move.
A majority of shareholders approved the plan, but two large Canadian pension funds said the payment to Stronach was too large and would dilute shareholder value.
Magna said that the Ontario Divisional Court on Monday dismissed an appeal of a lower court ruling that approved the plan.
In midday trading. U.S.-listed shares of Magna added $2.58, or 3.4 percent to $77.71.
