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Company to hold extraordinary shareholders' meeting on Nov

14

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Novo Nordisk Foundation holds a majority of voting rights

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Governance concerns over foundation chair's dual role

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Novo Nordisk shares have plunged more than 50% this year

(Adds detail on Norwegian fund's stake in paragraph 5 and

incoming chair and background in paragraphs 6-8)

By Stine Jacobsen and Soren Jeppesen

COPENHAGEN, Nov 10 (Reuters) - Norway's sovereign wealth

fund, the world's largest, said on Monday it will abstain from

voting on new board members at drugmaker Novo Nordisk's

extraordinary shareholders' meeting this week, including the

proposed new chairman.

Novo's controlling shareholder, the Novo Nordisk

Foundation, said last month it would install its own chair, Lars

Rebien Sorensen, to lead the drugmaker's board.

Current Novo Chair Helge Lund and six other independent

board members are set to step down at the November 14 meeting

after a dispute with the foundation over the pace of change at

the company.

GOVERNANCE CONCERNS OVER DUAL ROLE

The Novo Nordisk Foundation holds a majority of voting

rights through its investment arm Novo Holdings.

Norges Bank Investment Management held a 1.79% stake in Novo

Nordisk on June 30 valued at $5.54 billion, according to the

Norwegian fund's latest portfolio update. It did not provide a

reason for its abstention and was not immediately available for

comment.

The boardroom clash has added to the turmoil at Novo, whose

shares have plunged more than 50% this year as rival Eli Lilly ( LLY )

grabbed market share in the lucrative weight-loss drug

market.

Sorensen's dual role as both foundation chair and incoming

company board chairman is unprecedented in Novo's history and

has raised governance concerns among some investors. The former

Novo CEO, who led the company from 2000 to 2016, has said he

plans to serve as chairman for two to three years.

Analysts have described the foundation's move as giving it

"carte blanche"

control over the drugmaker, with its 77% voting share

representing an unprecedented concentration of power.

The foundation has been criticised for departing from its

stated "arm's length" approach to the company, acting more like

an activist investor as it seeks to restore sales and investor

confidence.

Shares in Novo Nordisk

rose 3% in early trade

on Monday, after the Wegovy-maker on Saturday dropped its

bid for U.S. weight loss drug company Metsera ( MTSR ), ending a bidding

war with rival Pfizer ( PFE ).