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AMSTERDAM (Reuters) - Hedge fund Elliott Advisors has become Dutch paint maker Akzo Nobel's largest shareholder by increasing its stake to at least 5 percent, according to a filing published by Dutch regulators on Friday.
Elliott's move follows a decision last week by U.S. firm PPG Industries to drop its attempts to buy Akzo for at least six months.
A spokesman for Elliott declined to comment.
Under Dutch market rules, investors must report their holdings when they pass certain thresholds. Elliott could in theory own anywhere between 5 percent and 10 percent of Akzo's outstanding share capital.
Elliott led a group of shareholders dissatisfied with Akzo's reluctance to enter talks with PPG over a 26.3 billion euro (23.1 billion pounds) buyout proposal, which represented a 50 percent premium to Akzo's share price in March before the approach.
With support from other institutional investors representing 18 percent of Akzo's shareholder base, Elliott launched a court case in Amsterdam seeking an investigation into alleged mismanagement at Akzo and an extraordinary shareholder meeting to discuss the dismissal of the company's chairman, Antony Burgmans.
Judges declined Elliott's request for such immediate remedies on May 29, but ordered the company to make attempts to repair its relationship with shareholders.
It is not clear whether Elliott intends to pursue the case further.
The hedge fund has previously said it began building a stake in Akzo in late 2016, seeing the owner of brands including Dulux paint as undervalued and underperforming.
Reporting by Toby Sterling; editing by David Clarke/Keith Weir