Mostostal Warszawa maintains chief's dismissal legal

Despite protests from Acciona, the largest shareholder in construction firm Mostostal Warszawa, last Thursday's dismissal of Mostostal president Neil Balfour was legal, claims Robert Butzke, head of Mostostal's supervisory board. After the five-member board voted to dismiss Balfour, two of its members, appointed by Acciona, resigned in order to render the move invalid, as Mostostal's by-laws state that the board can only make decisions when it has five members. However, both Butzke, as well as legal expert Bogdan Dzudzewicz from the Weil, Gotshal & Manges law firm, claim that even if some members of the board resign, decisions made earlier are binding. In any case, Balfour and the newly elected president Andrzej Marczewski released a joint statement saying that they agree on the fundamental issues regarding Mostostal's operations and the company's operations will continue as usual. Analysts say the dismissal of Balfour was an attempt by Elektrim, which holds a 28.5% stake in Mostostal, to force Acciona, which owns 49%, to buy its shares. The telecoms and energy conglomerate is reportedly trying to show the Spanish builder that it will make management of Mostostal difficult until it receives a fair offer for its stake. (Gazeta Wyborcza, April 7-8, p.31; Rzeczpospolita, April 7-8, p.B2) T.J.