The UK’s largest pension scheme has issued a rare public statement calling for the board of chemicals firm AkzoNobel to engage meaningfully with a €26.9bn takeover approach.

US paints manufacturer PPG earlier this week submitted a third bid for the Dutch company. AkzoNobel acknowledged the “unsolicited” approach in an announcement to the stock market on 24 April and promised to “carefully review and consider” the offer.

The Universities Superannuation Scheme (USS), a shareholder in AkzoNobel since 2010, today called for the company’s board to “engage in a meaningful and constructive dialogue with PPG”. It currently holds 1.28% of AkzoNobel’s issued shares.

Daniel Summerfield, co-head of responsible investment at USS, said in a statement: “We believe that this revised offer, with the assurances given, provides a launch pad for negotiations to commence in earnest.”

PPG also promised a “significant” reverse break fee, meaning it would contribute towards AkzoNobel’s costs if the deal falls through. Summerfield said this part of the offer was “particularly noteworthy” and called for the company’s board to “seize this opportunity and constructively engage with PPG as a matter of urgency”.

Activist investor Elliott Advisors also called for AkzoNobel to enter into “sincere and constructive discussions” regarding the offer.

In a statement, Elliott Advisors said: “There can be no reasonable doubt that PPG’s revised proposal represents a bona fide proposal from a credible counterparty; this proposal clearly warrants sincere engagement from AkzoNobel.”

Elliott also voiced concerns that a hostile bid – which it said could materialise if AkzoNobel failed to engage – would not necessarily include the same terms for shareholders. “Elliott therefore believes that friendly discussions now are in the best interest of all stakeholders,” the activist firm said.

Elliott took a major stake – roughly 3%, according to statements from the investment company – in AkzoNobel late last year as it believed the chemicals firm was undervalued and underperforming relative to its peers.

AkzoNobel has offered shareholders an alternative strategy, involving a restructure of the business.

In addition, earlier this month a group of shareholders called for an extraordinary general meeting (EGM), which newspaper reports suggested was aimed at ousting Antony Burgmans, chair of the company’s supervisory board.

AkzoNobel rejected the bid, but USS criticised this decision, claiming it showed the board was not taking its fiduciary responsibilities seriously.

“The decision to ride roughshod over shareholders’ rights not only undermines the credibility of the board but portrays Dutch governance in a very negative light,” USS’s Summerfield said.

“We took the unusual step at the annual general meeting of making public our concerns. The board and management now need to demonstrate that they are willing and able to fulfil their fiduciary duties to shareholders by evaluating objectively the revised offer by PPG.”

Elliott Advisors also strongly criticised the decision, describing it as “groundless” and “an egregious dismissal of shareholder rights, further evidence of self-entrenchment and… a continued affront to proper corporate governance”.

“Elliott believes that the reality is that AkzoNobel is afraid of calling the EGM because shareholder feedback apparently indicates that shareholders would vote to remove Mr Burgmans from his position as chairman of the supervisory board,” the activist investor said in a statement. “AkzoNobel’s supervisory board… has failed to fulfil its corporate governance duties by refusing to obtain, through engagement with a credible bidder, the necessary information required to evaluate a serious proposal.”

It added: “As far as Elliott is aware, it is unprecedented in European corporate history to have several large shareholders request the convocation of an EGM of a major corporate, and the fact that six AkzoNobel shareholders have done so in this instance is indicative of the breadth and depth of shareholder discontent with the conduct of AkzoNobel’s boards.”

AkzoNobel’s share price closed at €79.20 on 27 April, up by almost a third (32.6%) since the start of the year – driven primarily by trading in the wake of PPG’s bids.