Stockholm, Sweden/Baden and Zurich, Switzerland, February 28, 1996 - When ABB was formed on January 1, 1988 its two parent companies, ASEA AB and BBC Brown Boveri AG, retained their separate names, boards and stock listings. Since then, they have divested practically all assets other than their 50 percent share of the ABB Group. ABB's Board has been composed of eight Board members - each parent company nominating four members, including one of the two Co-Chairmen. The President and CEO of ABB, while not a Board member, attended the Board meetings.
In its meetings on February 27, 1996 the Boards of ASEA, BBC and ABB and the ABB AGM decided, respectively proposed, the following changes:
- Both parent companies, ASEA AB in Sweden and BBC Brown Boveri AG in Switzerland, will propose to their shareholders a change of their names to "ABB AB" and "ABB AG," respectively.
- All parent company Board members who are not members of the ABB Board will resign from the respective parent company Board (6 such members of the ASEA Board, and 7 of the BBC Board). Four Board members will thus remain in each parent company Board and they will also be members of the ABB Board.
- The new ABB Board will consist of 11 Board members. A single Chairman will replace the two Co-Chairmen. Four Board members will be proposed by each parent company and three will be elected directly by the ABB AGM. The Chairman is to be among the three.
- Parent company shareholders will in their respective AGMs obtain a direct influence on the composition of the ABB Board and the ABB dividend.
- Remaining staff personnel in the two parent companies will be combined with ABB staffs.
These changes strengthen the unity of ABB, internally and externally, and complete the merger at the ABB Board level. The current legal structure with 50 percent ownership of ABB by each parent company and the existing share classes remain unchanged. However, with the streamlining, the two parent company shareholder meetings will be more directly linked with ABB and the whole dividend from ABB will flow through to the parent company shareholders.
ASEA AB Board, Stockholm
BBC Brown Boveri Ltd. Board, Baden
ABB Asea Brown Boveri Ltd. Board, Zurich and Stockholm
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