36 The dispute between AAK and Enzymotec has been ruled upon In the spring of 2014, AAK AB communicated that it had initiated arbitration proceedings at ICC, International Court of Arbitration, against the company Enzymotec Ltd with respect to certain disputed matters under the Shareholders’ Agreement entered into on June 14, 2007 regarding the joint venture company Advanced Lipids. In the arbitration Enzymotec submitted a claim of USD 40 million against AAK. Enzymotec’s claim was denied in its entirety by the ICC tribunal. AAK’s declaratory claim against Enzymotec regarding liability was also denied. Financial goals AAK’s financial goals are to grow faster than the underlying market and to generate strong cash flows. We also intend to continually improve the return on operating capital. Planned dividend policy The objective of the Board of Directors, taking into account the development of Group earnings, its financial position and future development opportunities, is to propose annual dividends equivalent to at least 30 to 50 percent of the profit for the year, after tax, for the Group. Concluding comments by the President “Based on AAK’s customer value propositions for health and reduced costs, and our customer product co-development and solutions approach, we continue to remain prudently optimistic about the future. The main drivers are the continued positive underlying development in Food Ingredients and the continued improvement in Chocolate & Confectionery Fats.” Nomination Committee In preparation for the Annual General Meeting for 2016, the Nomination Committee has proposed the re-election of Board members Melker Schörling, Ulrik Svensson, Lillie Li Valeur, Märta Schörling, Marianne Kirkegaard and Arne Frank. The Nomination Committee proposes, in addition, that Melker Schörling be re-elected Chairman of the Board. In total, the Nomination Committee represents approximately 50.5 percent of the shares and votes in AAK as at December 31, 2015. AAK’s Nomination Committee for the 2016 Annual General Meeting consists of: Mikael Ekdahl (Chairman), Melker Schörling AB (publ.) Lars-Åke Bokenberger, AMF Fonder Henrik Didner, Didner & Gerge Fonder Åsa Nisell, Swedbank Robur Fonder Share capital and shareholder structure The total number of shares in AAK as at December 31, 2015 was 42,288,489. There is one class of shares in AAK, and each share entitles the holder to one vote. There are no limits as regards how many votes each shareholder may cast at an Annual General Meeting. Nor are there any limitations regarding the transfer of the shares resulting from provisions in law or in the Articles of Association. Of the Company’s shareholders, only Melker Schörling AB (publ.) has a shareholding which represents at least one-tenth of the number of votes of all shares in AAK. Melker Schörling AB (publ.)’s shareholding as at December 31, 2015 amounted to 32.9 percent of the shares and votes. AAK is not aware of any agreement between direct shareholders of AAK that would involve limitations in the right to transfer shares. The shareholder structure is described further in the section on the AAK Share, page 84. Acquisitions, strategic investments and disposals During the year, AAK made acquisitions in India and Belgium, and formed a new company for the Japanese market. New investments in the new factories in Brazil and China proceeded according to plan. Acquisitions in India In September, AAK acquired 51 percent of the shares in Kamani Oil Industries Pvt Ltd, one of the leading companies in speciality and semi-speciality oils in India. The company has an annual volume of approximately 100,000 MT and had sales of approximately SEK 1,000 million in the last financial year. The remaining 49 percent of the company’s shares will continue to be held by the former principal owner. AAK may, via a put and call option, acquire the remaining 49 percent of the company within the next 3–7 years. The company has a modern, strategically located production plant in Khopoli, 70 km south-east of Mumbai, where the company’s head office is located. The acquisition had very limited impact on AAK’s operating profit for 2015, and this acquisition consequently had a dilutive effect on the operating profit per kilo for 2015. The acquisition was completed on October 1, 2015, and the unit was consolidated during the fourth quarter. The acquisition will contribute to AAK’s operating profit during the first half of 2016. The preliminary estimate of the surplus value acquired was approximately SEK 260 million for 100 percent of the company and concerns customer relations (amortized with annual depreciation), goodwill and trademarks. Establishment on the Japanese market In October, AAK and Miyoshi Oils & Fats Co. formed a sales company for the Japanese market, AAK Miyoshi JP. This partnership will improve AAK’s business prospects on the local market, which is of particular interest to the Chocolate & Confectionery Fats and Bakery segments. AAK owns 70 percent of the company, and the remaining 30 percent is owned by Miyoshi Oils & Fats Co. The new company has resources in both sales and customer innovation and has made a manufacturing agreement with Miyoshi Oils & Fats Co., which will manufacture the products locally. AAK Miyoshi JP is based in Tokyo and operational since January 2016. Acquisition in Belgium In November, an agreement was made with the trustee in the bankruptcy of TLC and Belovo, two companies in the BNLfood Group, to restart the operations in TLC, a supplier of ingredients to the global nutrition market. When all necessary authorizations have been obtained, AAK will acquire the assets and operations of TLC. TLC specializes in extracting phospholipids from egg yolk. These are used as an ingredient in nutrition products and offer benefits such as reinforcing functions in the brain, the eyes and the immune system at all life stages. The amount invested is not material, and the transaction will have a very limited impact on AAK’s short-term profitability. The operations will continue to be run from the existing premises in Bastogne, Belgium. Strategic investments in China and Brazil The new factory in Brazil is planned to begin operations in the first half of 2016. The work to build the new factory in China is proceeding according to plan. Disposal of office building in Aarhus During the second quarter, the company sold the office building on M.P. Bruuns Gade in Aarhus, Denmark. The net profit from the disposal of the office building was SEK 45 million.
AAK Annual Report 2015
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