MAIRE TECNIMONT
MAIRE TECNIMONT
Research Report
Corporate Governance
January 2014
GROUPWORK 7
Kamilya Dosbayeva
Sebnem Dundar
Edoardo Fasoli
Alessandro Favero
Eleonora Vaccari
INDEX:
Executive Summary 1
1. Company Overview 3
1.1 Overview of the business 3
1.2 Ownership and group structure 4
1.3 Firm performance 5
2. Di Amato Case: from the CEO Duality to a powerful Chairman 6
3. Strategy and Risk Management Processes 8
4. Board of Directors 11
4.1 Composition and Processes 11
4.2 Committees 12
4.3 Changes on the Board 12
5. Key Issues 15
5.1 Board Issues 15
5.2 Remuneration of Executive Directors 16
5.3 Expropriation – Milking 16
6. Proposals 19
6.1 Board of Directors 19
6.2 Proposals Regarding Transparency 19
6.3 Executive Remuneration 20
6.4 Tunneling 20
EXHIBITS 22
BIBLIOGRAPHY 27
1. Executive Summary1
2.
3. Maire Tecnimont is a listed Italian group of companies founded in 2005 by the merger of two key companies in the Italian industry: Fiat Engineering (which was acquired in February 2004 and later became Maire Engineering) and Tecnimont (which was owned by Montedison and acquired in 2005). The Group is present in 28 countries, operating in mainly three areas of business, which are: engineering and construction, technology and licensing, energy and ventures. The Group has gone through initial public offering in Italian Stock Exchange in 2007. Since then, operating companies have been added to the Group.
4. As of December 31, 2012 the Group has a share capital of €16,125,000, composed by 322,500,000 ordinary shares. The Group is controlled by Fabrizio Di Amato, who holds control of the company through Maire Gestioni SpA.
5. The performance of Maire Tecnimont SpA shows a high correlation between the share prices, the projects commissioned and the acquisitions performed. In 2010 the Group suffered a sharp decrease in share price due to the uncertainty arising from the projects in South America. The Group approved the distribution of dividends in 2011
Research Report
Corporate Governance
January 2014
GROUPWORK 7
Kamilya Dosbayeva
Sebnem Dundar
Edoardo Fasoli
Alessandro Favero
Eleonora Vaccari
INDEX:
Executive Summary 1
1. Company Overview 3
1.1 Overview of the business 3
1.2 Ownership and group structure 4
1.3 Firm performance 5
2. Di Amato Case: from the CEO Duality to a powerful Chairman 6
3. Strategy and Risk Management Processes 8
4. Board of Directors 11
4.1 Composition and Processes 11
4.2 Committees 12
4.3 Changes on the Board 12
5. Key Issues 15
5.1 Board Issues 15
5.2 Remuneration of Executive Directors 16
5.3 Expropriation – Milking 16
6. Proposals 19
6.1 Board of Directors 19
6.2 Proposals Regarding Transparency 19
6.3 Executive Remuneration 20
6.4 Tunneling 20
EXHIBITS 22
BIBLIOGRAPHY 27
1. Executive Summary1
2.
3. Maire Tecnimont is a listed Italian group of companies founded in 2005 by the merger of two key companies in the Italian industry: Fiat Engineering (which was acquired in February 2004 and later became Maire Engineering) and Tecnimont (which was owned by Montedison and acquired in 2005). The Group is present in 28 countries, operating in mainly three areas of business, which are: engineering and construction, technology and licensing, energy and ventures. The Group has gone through initial public offering in Italian Stock Exchange in 2007. Since then, operating companies have been added to the Group.
4. As of December 31, 2012 the Group has a share capital of €16,125,000, composed by 322,500,000 ordinary shares. The Group is controlled by Fabrizio Di Amato, who holds control of the company through Maire Gestioni SpA.
5. The performance of Maire Tecnimont SpA shows a high correlation between the share prices, the projects commissioned and the acquisitions performed. In 2010 the Group suffered a sharp decrease in share price due to the uncertainty arising from the projects in South America. The Group approved the distribution of dividends in 2011
Bibliography: 281. Corporate Governance Code, Corporate Governance Committee, (Dec 2011) Code of best practice, 1.C.3”, Borsa Italiana (2011) Corporate Governance in Italy: The Structural Conflict of Interests Between Majority and Minority Shareholders, A CEO Duality Leadership And Firm Risk-Taking Propensity, The Journal of Applied Business research, First Quarter 2008, Volume 24, Number 1 Zattoni, A., 2009 Zattoni, A. and Cuomo, F., 2010. How Independent, Competent and Incentivized Should Non-executive Directors Be? An Empirical Investigation of Good Governance Codes. British Journal of Management, Vol. 21, 63–79. Melis, A. 2004. On the Role of the Board of Statutory Auditors in Italian Listed Companies, Corporate Governance: An International Review, 12 (1): 74-84. Carter, C. B. and J. W. Lorsch (2004). Back to the Drawing Board – Designing Corporate Boards for a Complex World. Boston, MA: Harvard Business School Press. Fama, E Investor Protection and Corporate Governance”, La Porta, Lopez-de-Silanes and Shleifer (1999) Not the usual suspects: How to use board process to make boards letters”, Finkelstein S., Mooney A Maire Second Road Show, Investor Presentation, Maire Tecnimont (July 2013) Half-year Report at 30 June 2013, Maire Tecnimont Annual Reports, Maire Tecnimont (2007-2012) Maire Tecnimont, Corporate Governance Report (2007-2012) GLV Annual Reports (2009-2011) Prima Investimenti Annual Report (2011) Elfa Investimenti Annual Report (2011) Zattoni’s Lecture Slides