Page 164 - CW E-Magazine (7-1-2025)

News from Abroad

UNDER SCRUTINY
Johnson Matthey’s largest shareholder calls for major

overhaul to raise profitability

Johnson Matthey, the UK-based
clean air technologies and sustainable
solutions provider, is facing mount-
ing pressure from its largest investor,
Standard Latitude Master Fund (Stan-
dard Investments), which has called
for an overhaul of its business strategy,
including a potential divestment of its
hydrogen business.

Johnson Matthey makes cata-
lyst-coated membranes (CCMs) and
other materials for use in electrolysers
and fuel cells, as well as carbon-capture
technology for blue hydrogen projects.

New York-based Standard Invest-
ments, which holds an 11.01% stake in
Johnson Matthey, criticised the com-
pany’s long-standing leadership and A major example cited was the criticised the company’s PGM (Plati-
its inability to deliver on the growth company’s exit from its battery num Group Metal) Services division
and profitability that it had previously materials unit, a business that had for being opaque and underperforming.
promised to shareholders. absorbed £340-mn in investments but
was sold for only £50-mn, resulting Standard Investments emphasised
In a public letter to Johnson Mat- in a massive £363-mn loss. Similarly, the need for greater transparency and
they’s Chairman, Mr. Patrick Thomas, the company’s hydrogen technologies better management of cash flow across
dated December 13, Standard Invest- division, which has consumed £310-mn the business. In response to these con-
ments expressed frustration with the in cash since FY22, continues to post cerns, Standard Investments is calling for
company’s continued underperformance, operating losses with no clear path to a complete overhaul of the company’s
particularly under the leadership of the profitability. leadership.
current Chairman and CEO.
Standard Investments accused the In addition to changes at the Board
Standard Investments outlined Board of a lack of discipline in invest- level, Standard Investments has recom-
several key concerns in its letter, notably ment decisions, particularly in ventures mended that Johnson Matthey take
the company’s poor financial manage- that were supposed to offset the decline immediate steps to “de-risk or sell” its
ment and its unprofitable ventures in in core businesses but instead only led hydrogen technologies business, which
growth businesses. It argued that while to further losses. it sees as having little future potential
Johnson Matthey had set up its hydro- given the company’s poor track record
gen and now-divested battery materials The letter also pointed to underper- in managing such ventures.
units to offset the decline of its main formance in Johnson Matthey’s core
business – catalytic converters for in- Clean Air business, which, despite its Standard also advocates for the
ternal combustion engines – the com- technological leadership, continues to launch of a formal review process,
pany has mismanaged its strategy for generate margins below industry peers. which could include exploring the sale
these growth sectors to the detriment of part or all of the company to maxi-
of its shareholders. Additionally, the investment firm mise shareholder value.

164 Chemical Weekly January 7, 2025

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