Euroshareholders files new request at Enterprise Chamber of Amsterdam Court 

Unequal treatment of Fortis shareholders 

The pan-European investors organization Euroshareholders is filing a new request at the Enterprise Chamber of the Amsterdam Court. Euroshareholders yesterday (January 12, 2009) filed a request asking the Enterprise Chamber to immediately order Fortis to allow shareholders in the Netherlands to vote on the sale transactions of 3, 5, and 6 October 2008.  

Euroshareholders is upset about the fact that Fortis put the approval of the 3, 5, and 6 October, 2008 transactions on the agenda of the Belgian shareholders meeting, but did not similarly seek approval from the shareholders of Fortis NV in the Netherlands. In the view of Euroshareholders, such treatment goes directly against the origin of the twinned-share structure of Fortis, based on equal treatment of Dutch and Belgian shareholders. For Euroshareholders, which is comprised of investors from 32 national investor associations, that is a key issue. Euroshareholders is acting on behalf of 15,000 Fortis investors. 

Euroshareholders is also basing its request on Dutch Law, which requires shareholder approval for decisions of the board concerning of a major change of identity or character of a company or firm. That Fortis' sales on 3, 5, and 6 October, 2008 represented a major change of identity and character is obvious. Around 95 percent of the business was sold, including Fortis Bank Belgium, Fortis Insurance Belgium, Fortis Bank Netherlands an Fortis Insurance Netherlands. 

Euroshareholders uses five criteria in its analysis:

• The number of Fortis employees will decrease from 85,000 to 5,000, a decline of 93 percent.
• The total assets of Fortis' pre-sale activities amounted to 871 billion euros. The remaining insurance operations have a total assets of 27 billion euros,  which is 97 percent lower.
• Revenues which totaled 120 billion euros in Fortis' pre-sale composition will fall due to the sale to around 8 billion euros, a decrease of 93 percent.
• The 2007 profit of the business remaining after the sale is 0.2 billion euros, a decrease of 95 percent compared to the profits of the whole of Fortis in 2007 (4 billion euros).
• The equity position fell from 33 billion euros to 7.7 billion euros, a decrease of 77 percent. Furthermore, this 7.7 billion is an artificially high valuation, since the toxic assets are valued at the carrying value and not the much lower market value. When the share price is used as an indication for the real equity position, the decline would actually be more than 90 percent.

In this light, it is very disappointing that the Board of Fortis continues to stand behind its the claim that- under Dutch law - it is not required to seek shareholder approval for the transactions of 3, 5, and 6 October, 2008. 

Euroshareholders finds it shocking that the outgoing Fortis board takes this position and - at the expense of shareholders - opposes equal treatment of its shareholders. During the Fortis shareholder meetings of 1 and 2 December, 2008, 3 of the 5 proposed new board members did not receive the necessary majority of shareholder votes in order to be elected to the board. As Fortis would not attain the minimum of 3 directors that is required under Belgian Law, the old Board of Fortis remained in place for the time being. 

With respect to the appointment of Fortis directors, Euroshareholders supports the four candidates nominated by Deminor and VEB.

• Georges Ugeux
• Jan Zegering Hadders
• Dirk van Daele
• Philippe Casier 
   

Euroshareholders, 

Peter Paul de Vries                                    Jean Pierre Paelinck
President                                                  General Secretary