Aker Proposes New Kvaerner Board

Aker Maritime, which wants wide-ranging link-ups with Kvaerner, proposed a new board for Kvaerner before a corporate showdown on Friday. Aker, the top shareholder in Kvaerner with 17.8 percent, put forward Pehr Gyllenhammar, chairman of Britain's biggest insurance group CGNU, as chairman of its proposed board. Kvaerner has said it opposes Aker's plans for link-ups. Gyllenhammar said he hoped he could help resolve the clash between the two Norwegian industrial groups but stressed he would be independent.

"The new board will have a completely free rein to assess the best strategy for Kvaerner," he said. "I want to make it clear that I haven't made up mind about the merger question that I understand is at the heart of the dispute." Last month, Kvaerner's own election committee proposed a new board led by former Christiania Bank chairman Harald Arnkvaern. But Aker's majority owner Kjell Inge Roekke said Kvaerner's proposal was not independent enough to consider Aker's plans for mergers with Kvaerner's oil and gas and shipping divisions.

Kvaerner shareholders will decide the new board at the company's annual meeting in Oslo on Friday starting at 1245 GMT. The choice of board could go a long way to deciding the fate of the company, since a victory for Kvaerner's proposal would rule out a merger. "It's too early to predict the outcome of the meeting," Aker spokesman Geir Arne Drangeid said. DnB Investor, which owns about 3.5 percent of Kvaerner, said it would vote for Gyllenhammar's board. An overview by the daily Aftenposten put support for Roekke at 23.8 percent of Kvaerner shareholders, including DnB, and Kvaerner at 21.8 percent. Kvaerner management and current board want the company to stay independent rather than tie up with Aker, reckoning the two are not a good fit after Aker sold its deepwater division to France's Coflexip last year. Kvaerner wants instead to strengthen its own two main divisions, Oil and Gas and Engineering and Construction. It is also planning to split the company into two or three. - (Reuters)