October 15, 2006

Ahold Breakup On Hold

-- By Pushpa Sathish, Staff Writer

The move to force Dutch retailer Ahold to break up its operations has still not reached a conclusion. Earlier this year, hedge funds Centaurus Capital and Paulson were pushing Ahold to sell its activities in the United States and focus on the European front, which they felt was more profitable.

Both funds, which jointly hold 6.4 percent of the retail business, have decided not to take any further action until a planned review of assets is complete. Ahold is planning to complete its review of underperforming assets this autumn.

Meanwhile, Stork NV is trying to take legal action against Centaurus and Paulson over their decision to push Ahold to breakup, saying that the funds were in violation of stock market disclosure regulations. The hedge funds, which own 33 percent of Stork, is in the bad books of the firm for forcing it to sell its non-aerospace divisions within a year and keep the aerospace unit as an independent listed firm.

Ahold is watching the proceedings of this operation very closely.

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