Newell Brands’ board of directors mailed a letter to the company’s shareholders on April 6 arguing that activist investor Starboard doesn’t understand the company and “has no plan.”
The letter again urged shareholders to vote for the board’s nominees at the company’s 2018 annual meeting. The annual meeting is scheduled to be held on May 15.
On April 4, Starboard Value LP, the activist hedge fund seeking to replace Newell Brands’ board, said the company plans to press ahead with a proxy fight at Newell Brands Inc., despite the company giving billionaire investor Carl Icahn four board seats, according to a regulatory filing.
Newell’s new letter to shareholders reads in part, “STARBOARD IS RELYING ON MISINFORMATION AND HAS NO PLAN.”
The letter adds regarding Starboard, “Prior to launching their original campaign to replace the entire Newell Board, Starboard could have reached out to management to ask questions, conduct due diligence and attempt to better understand our company and our industry. But instead, Starboard chose to rely upon Martin Franklin’s version of recent events at Newell Brands and failed to seek any other company views that would have allowed them to develop a fully informed view of the company and industry.
“Starboard has no plan. Martin Franklin was their plan, but Martin Franklin and his team are no longer part of the Starboard fight. Even when Starboard did have Franklin as part of their team, their plan was based on a dated business model that relied upon an acquisition-led strategy that was fueled by an entirely different retail, credit and acquisition value environment.
“Proxy fights are serious, expensive and disruptive events that are imperative at times when a company’s board requires replacement. Today, however, Newell has a new Board. We have a new chairman and seven other highly-qualified new directors and nominees. One of our new directors is the chairman of the Finance Committee, which is responsible for overseeing the company’s divestitures. We are disappointed that even with a new Board in place at Newell, Starboard has decided to continue pursuing its disruptive proxy fight in order to elect directors to a Board that already has eight new directors.”
The letter form the board concludes, “We believe Newell Brands is now embarking on a path to significant value creation. To that end, the new Board’s singular focus at this time is devising, articulating and executing the multi-year strategic transformation and operational turnaround that will once again make Newell Brands a best-in-class consumer products company that delivers outstanding returns. This is a critical moment in our history, and we hope that we can count on your continued support. We look forward to further detailing our Accelerated Transformation Plan in the weeks ahead.”
The full letter is here.
