By Toby Sterling
AMSTERDAM (Reuters) - Elliott Advisors, the activist investor with a 3.25 percent stake in Akzo Nobel <AKZO.AS>, said on Wednesday other shareholders owning almost a quarter of the Dutch paints and chemicals group want it to enter into talks with spurned U.S. suitor PPG Industries <PPG.N>.
Akzo has rejected a 24.4 billion-euro ($26.4 billion) takeover offer by PPG and declined to talk to the U.S. company to see if there was scope for a deal, saying it would press ahead with a new proposal to spin off its chemicals division instead.
But Elliott said it commissioned London-based shareholders' advisory firm Boudicca Proxy to poll 300 institutional investors, around half of Akzo's total shareholder base, on whether they thought Akzo should talk with PPG.
Half of those investors responded - accounting for about 24.6 percent of Akzo's outstanding share capital - and virtually all wanted Akzo to open talks, Elliott said in a statement.
Akzo Nobel spokesman Andrew Wood said the company's decision not to engage with PPG was based on taking into consideration the interests of all the company's "stakeholders", including not only shareholders but also employees and customers, as required by Dutch law.
"We have a plan for creating long-term value and we're looking forward to sharing that with investors" on April 19, he said, referring to when management are due to announce the plan.
Research and brokerage firm Bernstein published a note on Wednesday calling on Akzo CEO Ton Buechner to agree to talks with PPG.
"Despite your successful performance improvement ... I fear the stand-alone value of Akzo Nobel falls short of PPG’s offer," Jeremy Redenius said in the note, written as an open letter to Buechner.
"Moreover, I struggle to see viable options for you to meaningfully improve performance beyond what the market
already expects," Redenius said.
He said Buechner should view a deal with PPG at above 90 euros per share as a "huge success from your tenure at Akzo Nobel."
Elliott said in its statement on Wednesday that Akzo should hold talks with PPG ahead of the strategy presentation so that "an honest and objective consideration of the two alternatives can be made."
Akzo's shares closed at 76.91 euros, well below the implied value of PPG's share and cash offer of 89.82 euros.
(Reporting by Toby Sterling; Editing by Greg Mahlich and Jane Merriman)