The battle over control of Ellaktor is picking up, as indicated by comments yesterday from CEO Anastasios Kallitsantsis. Kallitsantsis and his team moved yesterday to take the initiative and announced an extraordinary general shareholder's meeting for January 7 to discuss management changes requested by Dutch group Reggeborgh Invest and a share capital increase by 50.4 million euros.
The share capital hike had been requested by banks for some months now as a condition to providing more working capital to subsidiary Aktor, whose liquidity problems have created a domino effect in the Greek market, while making it difficult for the company to claim new projects or implement signed contracts.
During a teleconference with analysts held after calling the extraordinary general assembly, Kallitsantsis announced the "Growth4Ellaktor" initiative, which is a continuation of the corresponding "Change4Ellaktor" initiative. Through the latter, the brothers Anastasios and Dimitris Kallitsantsis removed from Leonidas Bombolas and Dimitris Koutras from the company’s management.
From what Kallitsantsis said yesterday, there will be a corresponding counting of votes on January 7 to determine whether the group will be managed by a team appointed by Reggeborgh, or by today’s management.
Last week, the Dutch side said in an announcement that it secured the support of several shareholders in order to impose its positions at the next general meeting. Reggeborgh directly controls 10.36% of Ellaktor, while its percentage increases to 22.9% if it exercises the right to acquire a 12.55% stake held by Bombolas. If the percentages of other shareholders on its side are added, then it controls close to 35%.
Yesterday, the Ellaktor CEO said that "I am and will remain in favor of all those who want the good of Ellaktor and against anyone who acts against it", implying that the Dutch do not belong to this category. "This and the will of the shareholders, as expressed through their vote in the General Meeting, are the only factors that count for me," he added.
Reggeborgh Invest and the other two shareholders who submitted the request for an extraordinary general meeting have also requested a management audit for the last two years. This request is not included in the issues of the meeting announced yesterday. The Dutch group will have to go to court, ie appeal to the Court of First Instance, which will decide. But the decision of the Court of First Instance can be appealed by the opposing side and there can be a long legal battle. Last night, however, people associated with the Dutch group avoided any comment on Kallitsantsis' statements.
Yesterday's hastily organized conference call with analysts can be interpreted in a number of ways:
• Regarding his personal role in the management of the group, he said that he will offer his services for as long as the company needs them and will later pave the way for a new management team, as was the initial goal. In other words, Kallitsantsis will ask for the shareholders' vote to keep him in his position, against the Dutch proposal for a change of management, but leaves open the possibility of leaving down the track.
• On the crucial issue of losses from Aktor's operations abroad, which was the main problem of the initial consolidation plan, as reported by Business Daily, Kallitsantsis expressed certainty that these losses will be soon contained. As he said, from the 40.8 million euros that will be directed to Aktor from Ellaktor’s 50.4 million euro share capital hike, the obligations arising from the exit from foreign activities will require 20 million euros.
With this charge, according to Kallitsantsis, Aktor’s foreign losses will wind up. This forecast remains to be proven as the losses of the construction sector abroad have repeatedly proved to be higher than the estimates of the Kallitsantsis administration.
• Regarding the loan that the company is negotiating with banks, a question was asked by an analyst as to whether it will be issued on the condition of the share capital hike going ahead. The answer to this question was no, but without explaining why, since talks on the fresh debt have been held since summer and can be completed only when Ellaktor raises new funds.