May 23, 2020 / 12:38 PM / in 13 days

Activist investor raises pressure on renewables firm Energiekontor

FRANKFURT, May 23 (Reuters) - Activist shareholder group ENKRAFT has stepped up a campaign at German renewables group Energiekontor, arguing a recent shareholder vote shows increasing frustration about perceived conflicts of interest at board level.

ENKRAFT had previously proposed changes to the group’s three-member supervisory board, which includes Energiekontor’s two co-founders who together hold 51.53% of the group valued at 288 million euros ($314 million).

The activists want a new strategy for the group and have said that if founders and management cannot agree on a new direction the value of the company could be better realised through a sale.

Records on the group’s website show that at the May 20 annual shareholders’ meeting (AGM) most minority shareholders declined to endorse the supervisory board - a key gauge of investor dissatisfaction.

Stripping out the co-founders’ voting stake, the share of “no” votes at the AGM was roughly two thirds of the total submitted by minority shareholders, the data shows.

“The voting results in the AGM (are) evidence that minority shareholders do not feel adequately represented any more by the board,” said Benedikt Kormaier, managing director of ENKRAFT, which says it holds close to 3% in Energiekontor.

“The majority of outside shareholders are evidently not comfortable with the conflicts of interests the founders inherently have between their role in the supervisory board and their role as largest shareholders,” Kormaier told Reuters.

Shares in Energiekontor, which develops wind and solar projects, have risen roughly 8% since ENKRAFT’s demands were first made public earlier this month.

$1 = 0.9174 euros Reporting by Christoph Steitz; Editing by David Holmes

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