Belgium

Belgium

Deminor plans court action against Vestas

DENMARK: Deminor Recovery Services, a company targeting Vestas on behalf of disgruntled investors, is refusing to give up its campaign against the Vestas board and said it plans to take legal action against the company.

A vote to appoint a scrutiniser to examine recent business decisions by Vestas' board was voted down by 89.5% of shareholders at the company's AGM yesterday.

In response, Deminor partner Erik Bomans said the company is finalising a law suit that will be brought in the "next couple of weeks". "We claim that Vestas has had a major shortfall of revenues versus its own guidance, especially in the year 2010, and that it has not correctly informed investors about it."

He added: "Our clients have bought shares during the period when the information was misleading, and they are claiming compensation for their losses."

Speaking about yesterday's vote at Vestas' AGM, Bomans said he was not surprised at the result. He said: "We had spoken to many big institutional investors before the AGM. On the basis of these discussions, we had concluded that investors thought the issues we had highlighted in our extensive report are serious, but that the company has taken some steps that go in the right direction."

Asked about the possibility of court action, Vestas refused to comment. However, it highlighted chairman Bert Nordberg's statement that Vestas would not comment about allegations if it is not in the company's interest.

He said: "This applies especially in this matter, where Deminor has drawn up its proposal for scrutiny along the lines of the allegations already covered by the class action suit in the USA.

"Out of principle, Vestas does not comment on specific allegations in such lawsuits. If we chose to comment, it could give rise to procedural issues that could potentially harm Vestas' shareholders."

Deminor wanted shareholders to vote on the appointment of a scrutiniser to examine the Vestas board's recent business decisions. Under Danish law, any shareholder is allowed to submit a scrutiny proposal at a company's AGM. It has to be accepted by a majority. In January, Deminor purchased one Vestas share in order to facilitate this.

Last month it detailed the allegations in a report titled "Future value creation requires full transparency", which includes accounting issues and profit warnings, changes to the auditors and issues in India surrounding former chief financial officer Henrik Norremark.

Additionally, Deminor said it has questions over Vestas' order book and how it compares with intake orders, shipping and other variables. Deminor said the figures suggest orders described as firm and unconditional had been cancelled.

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