A truce has broken out. The French building materials and glass conglomerate Saint-Gobain announced just before the Easter weekend that it has made peace with its largest investor, the listed French investment group Wendel. In return for better representation on the board, Wendel has agreed not to raise its holding beyond 21.5 per cent, to limit its voting rights, and to follow a conciliation procedure rather than dragging disputes into public.

Is it a good result for both sides? Wendel gets to nominate two directors this year, and a third in 2009, on an expanded 16 person board. It will also pick one of the three executives who sit on a new strategy committee. For this Wendel has conceded relatively little. An outright takeover, or further stakebuilding was always unlikely given the constraints on Wendel’s balance sheet: its 18 per cent shareholding was two-thirds funded by raising debt. Under existing Saint-Gobain rules shareholders normally get double the votes after two years. Wendel agreed to limit its voting rights to 34 per cent.