Media Center

Search

11/11/2026

Ethan Allen Shareholders Hand Board Control to Doug Bergeron

Wall Street Journal (11/11/26) Schisgall, Elias

Shareholders of Ethan Allen (NYSE: ETD) have seemingly voted to elect Doug Bergeron and two of his other nominees to the company’s board of directors, handing the investor a victory in his proxy battle for control of the firm. The interior-design company said Wednesday that preliminary results from a shareholder meeting appear to show that Bergeron had won a seat, along with two other nominees proposed by his firm, DGB Investment: Kristine Miller and Stephen Oblak. Shareholders also voted for two of the company’s five nominees for the board: Maria Eugenia Casar and Tara Stacom. The results, if finalized, suggest DGB will have a 3-2 majority on the board. Shares were climbing 4.8% to $21.23 in afternoon trading. Bergeron said the new board will focus on strengthening corporate governance, returning to profitable growth, and selecting a successor to Chief Executive Officer Farooq Kathwari. “Throughout this campaign, we asked shareholders to give us the mandate to restore accountability, revitalize the business and return Ethan Allen to profitable growth,” Bergeron said. “Based on the preliminary results, shareholders have delivered that mandate.” Ethan Allen launched a search for a successor to Kathwari in September, targeting a named successor by June 30, 2027. Bergeron, who controls a roughly 5.2% stake in the company, previously said he had launched his own search for a new CEO. Prior to the shareholder vote, the company had said Kathwari would remain a nonexecutive member of the board of directors after he leaves the CEO position on June 30, and that he would step down from the board at the 2027 shareholder meeting.

Read the article

11/11/2026

ICGN Urges South Korea to Revise Mandatory Tender Offer Bill

Business Korea (11/11/26) Seon-young, Park

A global investor organization whose member institutions oversee more than $100 trillion in assets has called for a comprehensive review of the mandatory tender offer system being advanced in South Korea’s National Assembly. The move reflects concerns that the current bill, which gives controlling shareholders preferential treatment, may not adequately protect the rights and interests of minority shareholders. The International Corporate Governance Network (ICGN) warned in an open letter sent to the National Assembly’s Political Affairs Committee on Nov. 9 that the proposed mandatory tender offer system based on a “50% plus one share” threshold could result in unequal treatment of shareholders. The contents of the letter became public on Nov. 10. ICGN is a global corporate governance organization with institutional investor members in more than 40 countries. Its member institutions oversee more than $100 trillion in assets, and its principles are influential in how global investors exercise voting rights and assess companies. The amendment to the Financial Investment Services and Capital Markets Act, which passed the National Assembly's Political Affairs Committee, is designed to require an acquirer to first purchase the controlling shareholder's stake and then buy additional shares from minority shareholders only in the amount needed to reach “50% plus one share” of the company. The approach was proposed as a compromise to reduce the financial burden on acquirers, but it has a key drawback: when the controlling shareholder already holds a stake close to a majority, minority shareholders may have little opportunity to sell their shares. Concerns that requiring acquirers to purchase all remaining shares would significantly increase acquisition costs and potentially dampen the M&A market were behind the compromise. Financial authorities have also said they will proceed with the 50%-plus-one-share approach for now, leaving the question of whether to require a full tender offer for the remaining shares for further discussion. ICGN argued that allowing an acquirer to purchase the controlling shareholder's entire stake first runs counter to the principle of equal treatment of shareholders. For example, if an acquirer first buys a 40% stake held by a controlling shareholder, the subsequent tender offer to minority shareholders would cover only about 10% plus one share of the company. Even if all minority shareholders wanted to sell, each would be able to tender only about one-sixth of their holdings. Another concern is that if a controlling shareholder already owns more than 50% of a company, the acquirer could meet the 50%-plus-one-share requirement without making any additional tender offer to minority shareholders. The exclusive allocation of the control premium is another central issue. While the controlling shareholder can sell its entire stake at a premium reflecting the transfer of management control, minority shareholders may receive that price for only a limited portion of their holdings or may not have the opportunity to sell at all. Industry analysts warn that this could weaken the value and liquidity of shares held by minority investors. ICGN strongly recommended requiring acquirers to make a tender offer for all remaining shares when control of a company changes hands, in line with practices in major markets such as the European Union (EU) and the United Kingdom. EU rules generally require an offer for all remaining shares when control is acquired, while the U.K. Takeover Code generally requires a full offer to all shareholders when a person acquires more than 30% of a company's voting rights. If the 50%-plus-one-share compromise is retained, ICGN proposed applying the same pro rata allocation rules to controlling and minority shareholders. Under a pro rata allocation system, the controlling shareholder's stake is not purchased separately in advance. Instead, all shareholders participate in the tender offer at the same price and on the same terms. If the number of shares tendered exceeds the target amount, the acquirer purchases shares from each shareholder in proportion to their holdings, preventing the controlling shareholder from receiving priority. For example, if an acquirer seeks to purchase 50% of a company and the controlling shareholder owns 40%, with all shareholders tendering their shares, approximately 20% of the company's shares would be purchased from the controlling shareholder and 30% from minority shareholders on the same terms. The proposal is consistent with a call for a pro rata tender offer made by 18 domestic asset management companies in September. ICGN also called for measures to improve transparency. It said acquirers should clearly disclose the terms of an offer, how the price is determined, details of any share purchases made before the tender offer and the criteria for allocating shares. It also stressed the need for safeguards against transactions designed to circumvent mandatory tender offer rules. The legislative process has also been contentious. Most of the amendments to the Financial Investment Services and Capital Markets Act originally proposed by eight lawmakers called for mandatory purchases of all remaining shares. However, the ruling and opposition parties agreed on Sept. 15 to adopt the 50%-plus-one-share approach. The amendment passed the Political Affairs Committee on Sept. 17 and the Legislation and Judiciary Committee on Sept. 28, but its scheduled submission to the National Assembly plenary session on Oct. 1 was postponed amid opposition. The latest intervention by global investors follows a similar letter of concern from the Asian Corporate Governance Association (ACGA). In a letter sent to the National Assembly and the government on Nov. 7, ACGA recommended requiring acquirers who obtain more than 30% of voting rights and become new controlling shareholders to make a tender offer for all remaining shares. It also called for the price offered to minority shareholders to be at least equal to the price paid to the existing controlling shareholder. ACGA has more than 100 institutional members with combined assets under management exceeding $40 trillion. ICGN added that the National Assembly should engage in sufficient consultation with domestic and international institutional investors and listen to market participants before proceeding with a plenary vote. The bill's submission to the plenary session remains on hold following public opposition.

Read the article

11/11/2026

Teton Capital Takes Aim at Dong-A Pharmaceutical, Presses for Kang Jung-seok's Board Seat and 50 Billion Won in Shareholder Returns

The Financial News (11/11/26)

U.S.-based Teton Capital is pressing Dong-A Pharmaceutical (KS: 000640) (formerly Dong-A Socio Holdings) to overhaul its governance. It is calling for Chairman Kang Jung-seok to be appointed a registered director and for annual shareholder returns of 50 billion won. The move has drawn attention because Teton is challenging not only the level of dividends but also funding for affiliates and the board's oversight role. According to investment banking (IB) industry sources on the 11th, Teton Capital presented Dong-A Pharmaceutical's board with five proposed improvements to governance and capital allocation and requested a written response by December 4. It wants the company to implement the proposals by its regular shareholders' meeting in March next year. The central issue is Chairman Kang's management accountability. Kang personally holds a 29.3% stake, rising to 42.3% when shares held by related parties and those covered by agreements to exercise voting rights jointly are included. However, as an unregistered executive, he is not subject to the shareholder election process or the compensation limits for registered directors. Last year, Kang received 2.3 billion won in compensation, exceeding the 1.304 billion won combined pay of the six registered directors. Teton called for Kang to be nominated as a registered director and put to a shareholder vote, or, if he remains an unregistered executive, for his compensation to be subject to shareholder approval. Funding for affiliates is also at issue. As of August this year, Dong-A Pharmaceutical had provided 434.5 billion won in payment guarantees for affiliates, of which 243 billion won was related to BTGen. BTGen recorded cumulative net losses of 133 billion won from 2015 through last year. Kang is reportedly a personal holder of a 19.6% stake in BTGen. Teton called for additional funding and payment guarantees for BTGen to be suspended until an independent review is completed. It also questioned the board's independence, noting that all 27 capital allocation proposals considered by the board from 2023 through August this year passed without opposition. The efficiency of capital allocation has also come under scrutiny. From 2017 through last year, the consumer health business paid 339 billion won in dividends to the holding company. Over the same period, the holding company paid out just 78.2 billion won in dividends to shareholders. By contrast, substantial funds were invested in BTGen and biosimilar development, among other areas. Teton called for new investments and payment guarantees to be assessed against the cost of capital, and for at least 50 billion won to be returned to shareholders annually if there are no suitable investment opportunities. It also proposed appointing an outside director with experience in overseas consumer goods businesses and linking executive compensation to shareholder returns. Teton currently estimates Dong-A Pharmaceutical's fair value at 261,200 won per share, about three times the closing price of 86,200 won on the 6th. It argues that high-margin businesses centered on Bacchus and quality assets, including a 29.2% stake in ST Pharm, are not properly reflected in the share price. In a response on the 6th, Dong-A Pharmaceutical said it was focused on strengthening business competitiveness and stabilizing its management system after the merger, and would develop the relevant systems in stages. Teton, however, said the response contained no specific commitments to act and began publicly engaging with shareholders. Teton Capital CEO Ryan Albert said, “There is no need to wait any longer because of the merger,” adding, “Now that profits from the consumer health business can be returned to shareholders without going through dividends from subsidiaries, shareholder returns have actually become easier.” Meanwhile, IB industry observers say the central issue in this shareholder engagement is the decision-making structure for capital allocation, rather than the size of dividends. An IB industry source added, “The issue is what criteria the company uses to allocate the cash it earns to its affiliates, and how independently the board made its decisions in that process,” adding, “There is a possibility that disputes among shareholders over director appointments and shareholder return policies will intensify at next year's AGM.”

Read the article

11/10/2026

Flashlight Capital Partners Sends Second Letter to South Korea's Orion, Demands Disclosure of Basis for 20.5 Billion Won Paid to Owner Couple

BigGo Finance (11/10/26)

Flashlight Capital Partners (FCP) is escalating its campaign against South Korea's Orion (KRX: 271560). On the 11th, FCP sent a second public letter to Orion's board, demanding the company provide the basis for calculating the large compensation paid to Chairman Dam Chul-gon and Vice Chairman Lee Hwa-kyung, a married couple who are unregistered executives, and set a response deadline of the 20th. The central issue in the second letter is the compensation of the controlling shareholder family, who do not sit on the board. According to Orion's business report, the couple received a combined 20.5 billion won (approximately $15.3 million) over the four years from 2022 to 2025. FCP pointed out that this amount exceeds the total compensation paid to all registered directors in each of those years. The fund argued there is a fairness problem: registered directors sit on the board, participate in management decisions and bear legal responsibility, while unregistered executives carry relatively less legal burden. FCP also took issue with the fact that the payments are made separately from the director compensation limit approved at the shareholders' meeting. In its first letter on the 19th of last month, FCP delivered five demands to Orion: appoint the controlling shareholder family as registered directors or have them manage the company without pay; link management compensation to the share price; disclose plans for using surplus cash and expand shareholder returns; halt the acquisition of JoongAng Ilbo; and consider entering the pet food business. Orion denied on the 22nd of last month that it was participating in the JoongAng Ilbo acquisition, and in a reply on the 6th of this month it rejected all the remaining demands. In particular, FCP directly rebutted Orion's rejection of linking management compensation to the share price on the grounds that it "could encourage moral hazard." Stock-linked compensation is generally regarded as a mechanism to prevent management moral hazard, the fund argued — and the side refusing it is the problem. The promotion process has also come under scrutiny. FCP noted that Vice President Dam Seo-won joined as a senior manager in July 2021, was promoted to managing director in January 2023 and rose to vice president in January this year. The period from joining to promotion to vice president is about four and a half years. By contrast, according to Orion's business report, it takes an average of 24 years for an ordinary employee to become an executive, and the average age at promotion to managing director is 51.5. Vice President Dam reached managing director at 33, just one year and six months after joining. FCP demanded both the details of the promotion and the compensation data paid during that period. FCP also requested access to and copies of board minutes and opened an anonymous tip-off channel on its official website, raising the pressure. Lee Sang-hyun, CEO of FCP, said of Vice President Dam's promotion: "I question whether they have considered the sense of deprivation other employees would feel," adding, "I hope they will disclose the board minutes and related materials." Orion is South Korea's leading confectionery company with a 22% share of the domestic market. It is classified as a leading K-food stock, generating more than 60% of its revenue overseas, led by its flagship Choco Pie. Yet its enterprise value relative to the cash the company generates shows a wide gap with global peers. Orion holds more than 2 trillion won (approximately $1.5 billion) in net cash and financial assets, yet its dividend yield stands at just 2.8%. In its first letter, FCP argued that the company is undervalued relative to its overseas performance and called for governance improvements and expanded shareholder returns. In South Korea's stock market, there is a growing list of companies that have actually expanded shareholder returns after investors demanded better capital allocation. JB Financial (KRX: 175330), in which Align Partners is a major shareholder, presented a plan to raise its total shareholder return ratio from 32.4% in 2024 to 45% in 2026 and 50% over the long term, while continuing share buybacks and cancellations. KT&G (KRX: 033780) canceled all of its roughly 1.8 trillion won (approximately $1.3 billion) in treasury shares in April this year and decided in September on an additional 360 billion won (approximately $269.1 million) buyback and cancellation. The case is expected to be a test of whether Orion's governance and capital allocation policies could escalate into a proxy fight at a future shareholders' meeting. Whether FCP's requested board minutes are disclosed and how the owner family's compensation is explained are emerging as variables that will determine the direction of the campaign. The key questions are what stance Orion will take on the second letter and which side domestic and foreign institutional investors will back.

Read the article

11/10/2026

Former ISS Executive Guerra and Partners Launch Niscaya Governance

Reuters (11/10/26) Herbst-Bayliss, Svea

A group of corporate governance experts who have weighed in on some of America's most contested mergers and boardroom fights said they are launching a firm that will guide companies on how to engage with investors on critical shareholder votes. Cristiano Guerra, a former head of special situations research at proxy advisory firm Institutional Shareholder Services, is teaming up with four other industry veterans to run Niscaya Governance, the group said in an interview. His partners are Juan Bonifacino, who worked as a banker defending companies engaged by investors and is an ISS alumnus; Kim Castellino, who led ISS' U.S. research team; Effie Veres, a former senior equity analyst at hedge fund Citadel; and Bradley Vitou, who held activism defense roles at Ernst & Young and FTI Consulting. All partners previously worked at Strategic Governance Advisors (SGA), a division of strategic communications firm FGS Global. The team, which advised companies including media giant Warner Bros (SKYD.N) and athletic apparel retailer Lululemon (LULU.O), is beginning work at the start of what some analysts are forecasting will be a contentious corporate annual meeting season and one of the busiest deal-making environments in years. Companies are increasingly turning to advisers like Niscaya to prepare management to communicate better with shareholders and decode how proxy advisors ISS and Glass Lewis may recommend they vote on hot-button issues like proposed mergers, who sits on boards and executive pay. "We prepare companies to engage effectively with the proxy advisors and the investors who are casting these consequential votes," Bonifacino told Reuters. "We help our clients cut through the noise and focus on what will truly resonate." The firm's partners will work mainly from New York, Washington and San Francisco, and Niscaya joins a number of advisory firms including PJT Camberview and Jasper Street. Since the partners began working together, they have advised dozens of prominent companies, drawing on their expertise at ISS, managing to retain board seats for many challenged directors and to help get contested mergers approved, lawyers and bankers said. "The rules and dynamics of proxy solicitations are evolving rapidly and this team has a truly unique perspective that can be of great value to public companies facing or looking to avoid contested shareholder votes," said Sebastian Alsheimer, head of shareholder engagement and activism defense at law firm Cleary Gottlieb Steen & Hamilton. Bloomberg ranked SGA, where the partners previously worked, as the No. 1 strategic activism defense adviser to companies with more than $1 billion in market capitalization. The five partners left SGA in October. Chris Cernich, who preceded Guerra as ISS' head of special situations research and co-founded SGA a decade ago, retired in August.

Read the article

11/10/2026

ValueAct Issues Open Letter to Takara Holdings Shareholders Explaining Request for an EGM

Morningstar (11/10/26)

ValueAct Capital has requested an extraordinary general meeting at Takara Holdings (TYO: 2531) to replace three incumbent outside directors with independent nominees, arguing that the Japanese beverage and biotechnology company has underperformed and resisted meaningful strategic change. ValueAct says its six years of engagement, including numerous meetings and extensive analysis, produced no satisfactory response from the board. Before its first major shareholding disclosure in August 2025, Takara’s shareholder returns had trailed Japan’s TOPIX index by 44 percentage points over 10 years and 54 points over five years. ValueAct criticized a ¥54 billion tender offer for Takara Bio, saying the investment would not earn the company’s cost of capital based on management forecasts. It also faulted the board for not independently evaluating alternatives, including a potential sale. The activist proposes directors with management, public-company leadership, mergers and acquisitions, and accounting expertise. Its suggested strategic alternatives include focusing on Japanese alcoholic beverages and food businesses. Takara’s board rejected requests for an independent strategy review and board refreshment, prompting ValueAct to seek shareholder support.

Read the article

11/9/2026

PepsiCo to Cut Some Jobs in North America

Reuters (11/09/26) Shekhar, Sanskriti; Thomas, Shania

PepsiCo (PEP.O) is cutting some jobs in its North America food and beverage business as part of a plan to streamline the unit. The job cuts are expected over the next week and are aimed at simplifying the company's structure, according to a letter to employees from PepsiCo North America CEO Ram Krishnan obtained by Reuters on Monday. "The goal is to move faster, execute better, and invest behind the opportunities that will drive our growth," Krishnan said in the letter. The cuts come as the Lay's maker works to reignite growth in North America amid sluggish soda sales, weaker demand for higher-priced snacks and elevated input costs. Last month, the company lowered its full-year earnings forecast after reporting continued softness in the continent, particularly in its beverage division. The Wall Street Journal reported earlier in the day that PepsiCo was cutting around 1,000 jobs in its food and beverage business in North America. PepsiCo employed about 306,000 people worldwide as of December 27, 2025, including roughly 125,000 people in the United States, according to its annual report. The company has been pursuing productivity savings as part of a turnaround effort launched after Elliott Investment Management took a roughly $4 billion stake a year ago. Shares of the company were up about 1% in late-afternoon trading on Monday.

Read the article

11/9/2026

Vanguard Expands Proxy Vote Plan to Cover $8.2 Trillion in Funds

Bloomberg (11/09/26) Marsh, Alastair

Vanguard Group Inc. is expanding a program it says is designed to better reflect individual investor preferences at shareholder meetings. The move means that investors in all Vanguard’s U.S. equity funds, representing $8.2 trillion in assets, will be able to choose the voting strategy for their holdings, the Pennsylvania-based firm said in a statement on Monday. The changes, which encompass the world’s largest mutual fund — the Vanguard Morningstar Total Stock Market Index Fund — take effect next year. With its Investor Choice program, Vanguard is part of a growing shift among major U.S. asset managers including BlackRock Inc. (NYSE: BLK) and State Street Corp. (NYSE: STT). The firms say such proxy voting programs offer investors greater choice while reflecting a diversity of client opinions. The rise of so-called pass-through voting has coincided with greater political scrutiny in the United States of the extent to which money managers appear to support proposals tied to environmental, social or governance (ESG) goals. The Investor Choice program can help allay any potential concerns about an asset manager’s voting biases, John Galloway, global head of investor engagement at Vanguard, said in an interview, noting that the firm also engages with policymakers. “We have over 50 million individual investors in the United States, and tens of millions more internationally; those individuals have a wide range of perspectives,” Galloway said. “And actually what Investor Choice program participation is showing us is we were right: it's kind of like a normal distribution, they're across the spectrum.” Clients signing up to the program can select a proxy voting policy that's aligned with their preferences, such as voting with management or prioritizing ESG. That then determines how their proportion of the fund votes at public company shareholder meetings on decisions spanning board posts, executive pay and core ESG themes. However, the pass-through system doesn't typically allow an individual investor to choose how their shares are allocated in voting for every individual ballot. Vanguard has offered its clients access to Investor Choice since 2023. With the latest update, the amount of assets encompassed by the program has doubled.

Read the article

11/9/2026

Whitbread Shareholders Reject Activist Investor’s Push for Board Seat

City AM (11/09/26) Armstrong, Felix

Whitbread (LON: WTB), the owner of Premier Inn, has defeated Corvex Asset Management’s attempt to secure a board seat for director James Gemmel. More than 83% of votes at Monday’s general meeting opposed the appointment, giving the hospitality group a decisive victory. Corvex had criticized Whitbread’s capital allocation, particularly its £1.1 billion expansion in Germany, and demanded a comprehensive review of its spending strategy. The company rejected the proposal, arguing that its existing turnaround plans had only recently been developed. Whitbread plans to return £2 billion to investors through a strategy that includes selling its standalone restaurant chains, Beefeater and Brewers Fayre, cutting nearly 4,000 jobs, and raising £1.5 billion by selling the freehold rights to additional hotels. The measures partly respond to unexpectedly higher business rates affecting hospitality companies. Whitbread operates approximately 850 Premier Inn hotels across the UK. Chair Christine Hodgson thanked shareholders for supporting the board and said the company would continue implementing its five-year plan, targeting stronger margins, cash flow, and shareholder returns. Whitbread shares fell 1.9% to 2,774 pence following the vote, although they have risen approximately 19% over six months. Corvex managing partner Keith Meister argued that Whitbread’s structural complexity and capital allocation had produced persistently negative returns over one-, three-, five-, and ten-year periods.

Read the article
Next