Merlin Properties Calls Extraordinary Board Meeting to Discuss CEO Ouster

(Bloomberg) -- Spain’s Merlin Properties Socimi SA called an extraordinary board meeting to discuss the removal of its Chief Executive Officer Ismael Clemente, according to a person familiar with the matter.

The board has been called at the behest of Banco Santander SA, the company’s top shareholder, and is set to meet at 7 p.m. local time on Monday, according to the person, who asked not to be named because the matter isn’t public. Santander owns 23% of Merlin and the firm’s chairman, Javier Garcia-Carranza, is an executive at Spain’s biggest bank. 

Santander declined to comment. A Merlin spokesperson confirmed there would be a meeting this evening.

Last week, the board discussed the removal of Clemente, but didn’t vote on it, according to the person. The shares fell as much as 6.1% Monday on reports that the executive, one of the founders of the company, might be removed.

“The departure of Ismael Clemente, and his team, would be bad news for Merlin because he enjoys the recognition of the sector, and the market, after doing an excellent job,’ Banco Sabadell SA analysts wrote in a note Monday.

The management team of Merlin and 185 employees published a statement Monday to express support for Clemente. Merlin “doesn’t deserve abusive and feudal behaviors by minority shareholders who pretend to exercise majority control,” they said.

Merlin is Spain’s largest real estate investment trust with 913 assets ranging from offices, logistics facilities and shopping malls and bank branches let to Banco Bilbao Vizcaya Argentaria SA with a combined gross asset value of 12.9 billion euros ($14.6 billion). 

The firm, set up to buy and manage real estate as Spain emerged from a housing and financial crash of about a decade ago, held its initial public offering in 2014.

Clemente and Garcia Carranza have been at loggerheads for years over the management of the company, according to two people familiar with the matter. 

Last year, Santander lost another high profile board room fight at Spanish publisher and media group Promotora de Informaciones SA, when a hedge fund managed to win over enough support to sideline the bank’s proposal.

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