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Magna on high as Stronach departs

If there was any bad blood left among Magna International Inc. shareholders over Frank Stronach's near $1-billion payout to relinquish control of the company, it wasn't evident Wednesday. 传奇私服 A thunderous standing ovation greeted him after he delivered his final speech as chairman of the auto-parts maker. Investors have enjoyed the ride their shares have taken since the plan to remove Mr. Stronach was announced last year, and even re-elected him to their board of directors at the company's annual general meeting in Markham, Ont., Wednesday. In his farewell address, Mr. Stronach told the tale of a how he arrived from Austria to Quebec City in 1954 with only a suitcase, a windbreaker and few pairs of socks, managing to eventually found his business in a Toronto garage three years later before building it into the global juggernaut that it is today.传世私服 The company appears to not have skipped a beat over the compensation it awarded Mr. Stronach for relinquishing his control block last year. It reported a 44% increase in its first-quarter earnings, and raised its sales forecast for 2011 to between $27.1-billion and $28.5-billion from its previous guidance of between $24.8-billion and $26.8-billion. "Last year, I accepted a proposal by shareholders to eliminate my control block, which I did, and I have no regrets," Mr. Stronach said. "I was naturally thinking, because one of these days I won't be around, could I manage Magna from the grave? There was a lot of thinking about that,传世私服 传奇世界私服 but I came to the conclusion that was very difficult to do. So I accepted that proposal." He credited the company's success to its ability to avoid debt after a near-collapse in the 1990s and urged the company's management to hold that course. Mr. Stronach said he would now focus his attention on Magna's electric-car division, in which his family trust holds a controlling stake and which he will spearhead. At the same time, the unsuccessful objections from a vocal group of high-profile shareholders over the payout Mr. Stronach received last year appeared to have subsided at the meeting. Not only was Mr. Stronach re-elected to the board Wednesday, but so too was Mike Harris, 魔域私服 who headed the special committee tasked with reviewing the proposal for the board and finally approved it. Magna's board will now meet to decide who will succeed Mr. Stronach as chairman, a process Donald Walker, the company's chief executive, said should be completed within a week. Mr. Walker admitted that the price paid to Mr. Stronach was "an expensive deal" but that it was something shareholders had wanted for years to help eliminate some of the company's historical trading discount. "No matter what you do in life, people are going to criticize it," Mr. Walker said. Instead of dwelling on it, Mr. Walker said he will focus on removing the other barriers Magna's shares face,传奇私服 namely concerns around the losses at its electric-car business and the troubles in its European division. To that end, he noted the loss in the electric-car division fell to $25-million in the first quarter, from $37-million in the fourth quarter of last year. He said investors could expect similar quarterly loss for the remainder of the year. At the same time, Mr. Walker said the $50-million first-quarter loss from four of its troubled European facilities is expected to be halved by the end of the year through restructuring efforts. Those efforts are part of a broader European restructuring, he said. Magna's European division had a margin of just 0.9%, compared to 10.2% in the United States, 传奇私服 新开传奇私服 at the end of the first quarter. David Tyerman, a Canaccord Genuity analyst, said Magna was on the right track, and added its shares are worth a lot more today than they were last year before the Stronach buyout. "The multiple is higher today, and probably a reasonable part of that is because they did give Frank $1-billion,"新开魔域私服 传奇私发服网 he said. "It cost them a lot, but in the end, the shareholder was better off."