Methanex Investor M&G Plans to Nominate Four Board Directors

(Bloomberg) -- Methanex Corp.’s largest shareholder plans to nominate four directors to the company’s board on the grounds that new leadership is needed to oversee the development of a methanol plant in Louisiana.

M&G Investment Management Ltd., which owns a 16.5 percent stake in Vancouver-based Methanex, said in a letter to shareholders Monday that it has raised concerns with management about the risks of building the plant without a partner.

M&G said it plans to nominate the directors at the company’s shareholder meeting in April because it doesn’t believe Methanex takes seriously its concerns that building the plant alone could stress its balance sheet and make it harder to pay dividends and repurchase shares.

“We are concerned that there is not sufficient oversight from the independent directors within the board room to maintain financial discipline in what is a relatively indebted company in a cyclical business,” M&G said.

Methanex said in a statement that it already put forth its slate of 11 directors for the annual general meeting on April 25. Ten of those are independent and four of them have joined since 2016.

“Methanex is committed to acting in the best interest of all shareholders and gives due consideration to constructive recommendations for strategies or actions that have the potential to create value,” the company said in the statement. “Through an ongoing private dialogue with M&G over the last two years, it is clear M&G has developed a short-term focus on share buybacks.”

M&G’s nominees include: Paul Dobson, acting chief executive officer of Hydro One Ltd.; Lawrence Cunningham, a law professor at George Washington University; Patrice Merrin, the former CEO of Luscar Ltd.; and Kevin Rodgers, a former global head of foreign exchange trading at Deutsche Bank AG, according to letter.

Methanex produces and supplies methanol throughout North America, Europe and South America, according to its website.

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