UPDATE 1-Elementis shareholder demands board launch immediate sales process -letter

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LONDON, Jan 25 (Reuters) – Elementis shareholder Franklin Mutual Advisers has urged the board of the British chemicals firm to “initiate a sales process immediately” following news it had spurned another takeover approach, a letter obtained by Reuters shows.

In a letter sent to Elementis Chairman John O’Higgins on Thursday, senior Franklin Mutual portfolio managers Steve Raineri and Chris Meeker said they were “deeply concerned” that the Elementis board appeared not to be acting in the best interests of shareholders.

Reuters on Wednesday reported that New York-based private equity firm KPS Capital Partners in December submitted a bid valuing the FTSE 250 company at about 160 pence per share, but the Elementis board rejected the offer.

“In our view, this recent interest from KPS, coupled with prior offers from Minerals Technologies and Innospec, again confirm Mutual Series’ view that the Company is a desirable acquisition target,” the letter said.

“We believe this indication of interest should be the catalyst to launch a formal process to maximise shareholder value.”

(Reporting by Sinead Cruise; editing by Jason Neely)

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