SANTIAGO, April 18 Three top shareholders in
Chile's SQM have agreed to change the way board decisions are
made at the global supplier of lithium, they said, a move that
will see controlling shareholder Julio Ponce cede some power and
Canada's Potash Corp gain more say.
The agreement, announced late on Monday, was sent to Chile's
securities regulator and signed by Potash Corp,
Ponce-controlled Pampa Calichera, and Japan's Kowa. It
stipulates that at least five of the eight board members must
agree to any future decision, and that the chairman no longer
exercises a vote in the event of a deadlock.
Potash Corp holds just over 30 percent of SQM
, and has three board seats, while Kowa and
Pampa Calichera have a joint voting pact that gives Ponce say
over four seats. Previously, the chairman had the casting vote
in the event of a tie. The current chairman is Eugenio Ponce,
Julio Ponce's brother.
The move indicates that Ponce has agreed to cede some power,
potentially opening up the way for a rapprochement with the
center-left Chilean government, with which SQM is in dispute.
Julio Ponce is a controversial and divisive figure. The
former son-in-law of late Chilean dictator Augusto Pinochet, he
has held power at SQM since it was privatized under Pinochet in
the 1980s. In 2014 he was fined for market manipulation.
SQM has exclusive rights to tap vast reserves of lithium and
other minerals in the Chilean desert. But it is in a legal
dispute with government agency Corfo over royalty payments,
which has weighed heavily on its stock.
Corfo's head has repeatedly criticized Ponce and told
Reuters in January that developing a good relationship with SQM
was impossible while Ponce remained in control.
The new agreement came after Potash, Kowa and Ponce had
agreed that "the interests of SQM and all of its shareholders
would be better served going forward with the SQM board of
directors operating with as large a consensus base as possible,"
Potash Corp said in a statement.
"Potash Corp believes this is a step forward in improving
corporate governance for all SQM shareholders."
(Reporting by Rosalba O'Brien; Editing by Paul Simao)