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Berkshire intends to oppose USG board nominees after Knauf bid

(Reuters) – Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) plans to oppose board nominees proposed by USG Corp (USG.N) in an upcoming shareholder vote, as the wallboard maker tries to fend off a roughly $5.9 billion takeover bid by Germany’s Gebr Knauf KG.

FILE PHOTO: Berkshire Hathaway CEO Warren Buffett visits the BNSF booth before the Berkshire Hathaway annual meeting in Omaha, Nebraska, U.S., May 6, 2017. REUTERS/Rick Wilking/File Photo

“Berkshire’s present intention is to vote against the four directors proposed by management,” Buffett assistant Debbie Bosanek said in an email.

Berkshire owns roughly 31 percent of USG, whose shares gained 2.4 percent.

USG and Knauf did not immediately respond to a request for comment.

Knauf, a producer of building materials, called on USG shareholders on Tuesday to pressure it to engage in deal talks by withholding their support for its board nominees. The German company said in an earlier statement that voting against USG’s four board nominees would send a message that USG must engage in deal negotiations.

USG rejected Knauf’s bid two weeks ago, arguing it undervalued the company. That was despite Berkshire, which is USG’s largest shareholder, offering to sell its stake at that price, if Knauf clinched a deal for the entirety of USG.

Reporting by Trevor Hunnicutt and Jonathan Stempel in New York; Editing by Steve Orlofsky

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