The week in investor relations: Global highs, no to J&J CEO pay package and bumper dividend from Samsung
– Markets hit record highs this week, with Europe’s Stoxx 600 recovering all of its pandemic-driven losses with investors betting on ‘a speedy global economic recovery, spurred by bumper stimulus spending and Covid-19 vaccination programs,’ reported Reuters. The S&P 500 also hit a new high and the news agency noted it took Europe’s benchmark equity index seven months more than the US S&P 500 to reclaim its pre-pandemic high, as the continent was slowed down by a sluggish vaccination roll-out and a new wave of infections.
– ISS has joined Glass Lewis in recommending a vote against a pay package of almost $30 mn for Johnson & Johnson CEO Alex Gorsky, reported Reuters. The news agency said J&J is attracting investor scrutiny because it partially shields Gorsky from some $9 bn in costs over two years that have arisen from lawsuits that claim the healthcare company fueled the US opioid crisis as well as allegations of asbestos in its talc baby powder. In a note to shareholders ISS said ‘...investors may nonetheless expect an explanation from the company of how the compensation committee considered the extraordinarily large litigation charges when making compensation decisions.’
– A special cash dividend from Samsung Electronics this month will put pressure on South Korea’s won, according to Bloomberg, which reported that dividend payments to foreign investors typically pressure the currency in April. Combined with the company’s regular dividend, Samsung will be paying out more than five times the usual amount, said the news agency. Dividend payments to foreign investors are expected to more than double this month to 10.5 tn won ($9.4 bn) from a year ago, according to Bloomberg’s own calculations and largely due to Samsung’s special cash handout.
– In other dividend news, CNBC reported that the world’s biggest oil firm remains confident it will still be able to meet dividend payout expectations after Saudi Arabia’s government announced plans to prioritize investments. Crown Prince Mohammed bin Salman on Tuesday said that state-backed oil giant Saudi Aramco and petrochemical firm SABIC will fund the majority of a 5 tn riyal ($1.3 tn) private sector investment plan for economic diversification.
– The listing of gene-sequencing specialist Oxford Nanopore could herald ‘the true beginning of London’s tech revolution,’ accord to Investors’ Chronicle. The biotech has selected London as its IPO venue, with the company’s ‘long-awaited float’ potentially arriving in the second half of 2021. Chief executive Dr Gordon Sanghera says that 2020 was a ‘pivotal year’ with the company’s technology used around the world to track variants of the virus that causes Covid-19 and identifying around a fifth of the ‘SARS-CoV-2’ genomes that have been catalogued by scientists from more than 85 countries. However The Times (paywall) reported that the company’s CEO Gordon Sanghera, was found by a US judge to have misled regulators in a patent court case.
– Anglo American is set to spin out its thermal coal assets following climate pressure, according to The Times, in a move that will see its South African thermal coal operations turned into a new company that ‘will test the appetite of London investors to own a miner dedicated to the polluting fuel’. The FTSE 100 mining group said the demerged company, Thungela Resources, was expected to start trading in June via a primary listing on the Johannesburg Stock Exchange and a standard listing in London.