Media Center

Featuring all breaking news and in depth articles and editorial press coverage pertaining to shareholder activism and corporate governance.

Bed Bath & Beyond Overhauls Board Amid Investor Pressure
Bed Bath & Beyond's Revamped Board Fails to Win Over Investors
Knight Vinke Calls for Uniper Split to End Fortum Deadlock
Bramson v Barclays: Big Week for Investor Before AGM Battle
SEC Investor Advocate Cautions on Proxy Adviser Controls
Crystal Amber Takes Aim at Peter Dolan, Chairman of Tech Incubator Allied Minds
Ancora Gets Its Engagement Together
TransAlta Investors End Partnership Ahead of Annual Meeting
Nuveen 2019 Proxy Season Preview
LGIM's Votes Against Directors Increased by More Than One Third Last Year
Shareholder Adviser ISS Backs Barclays in Bramson Battle
Tesla to Cut Down on Board Members
Anthem and UnitedHealth Group Among Top Competitors to Acquire Magellan Health
D.E. Shaw Is to Buck Industry Trend With 3-and-30 Fees
Bill Ackman Thanks Warren Buffett for Pershing Square's Turnaround
Two New Executives Nominated to L Brands Board of Directors
Pernod CEO: In Regular and 'Courteous' Talks With Elliott
Head of Japan's Lixil Bows to Investor Pressure in Boardroom Drama
Elliott Target Pernod Pushes Up Profit Outlook
L Brands Says Hedge Fund to Withdraw Board Nominees After Reaching Agreement
BBB Investors to Announce Their Improvement Plan Next Week
U.S. Investors Abandon Effort to Force TransAlta Into Shareholder Vote Over Brookfield Partnership
Cerner Discloses New Board Members' Ownership Stakes
Engaged Capital Triples Down on Rent-A-Center Bet
SEC Investor Advocate Cautions on Proxy Adviser Controls
Why Activism Paid Off for Dan Loeb's Third Point
2019 Say on Pay & Proxy Results
Analysis: Will Investors Stick With Dual-Class Shares?
Global Firms Aim to 'Change Lives' by Backing U.K.'s Ethical Companies
A Successful Strategy for Activist Investors in Japan: Ask, Don't Tell

4/22/2019

Bed Bath & Beyond Overhauls Board Amid Investor Pressure

Wall Street Journal (04/22/19) Chin, Kimberly

Under pressure from investors to turn around its operations, Bed Bath & Beyond Inc. (BBBY) said on April 22 that it will make a series of changes to its board, including the appointment of five new independent directors. The retailer's board will now comprise 10 directors that will vary in race, gender, ethnicity, and experience level, with an average tenure of less than four years. Nine of those directors will be independent, and six will be women, the company said. Meanwhile, five of its current independent directors will step down, and co-founders Warren Eisenberg and Leonard Feinstein will retire from the board and move into the role of co-chairmen emeriti. Effective immediately, Patrick Gaston, current lead independent director, will be named independent chairman. Among other things, Bed Bath & Beyond will form a committee and undergo a strategic review of the whole business; appoint committee chairs to its board audit and compensation committees, which also will be reconstituted; and create a new executive compensation plan that better aligns compensation with the company's performance and long-term shareholder value creation. Legion Partners Asset Management LLC, Macellum Advisors GP LLC, and Ancora Advisors LLC—which control a combined 5% stake in the company—have criticized the company for failing to adapt over time and eroding value for shareholders by allowing costs to increase. They called for CEO Steven Temares to be replaced and nominated a slate of directors for the board. The investors have so far declined the retailer's invitation for them to participate in its plans to overhaul the board.

Read the article

4/22/2019

Bed Bath & Beyond's Revamped Board Fails to Win Over Investors

Bloomberg (04/22/19) Lichtenberg, Nick; Deveau, Scott

Despite yielding to some demands of Legion Partners Asset Management LLC, Macellum Advisors, and Ancora Advisors LLC by naming an independent chairman and replacing five independent investors, Bed Bath & Beyond's (BBBY) actions fall short and the retailer failed to provide details on how the new board would create value for shareholders, said the trio of investors. In an April 22 statement, the group said, "The board changes announced today by Bed Bath are not nearly enough when measured against what is needed to address the issues with the current board and management, including that CEO Steven Temares must be held accountable for the company's prolonged poor performance." Although the investors are still reviewing the new directors, their initial assessment is that they lack the necessary skills and retail experience to implement the needed changes. The group said its own slate of 16 independent candidates would be focused on hiring a new CEO, repositioning the company for growth, and implementing best-in-class corporate governance. Under the changes announced earlier on April 22, Bed Bath & Beyond named lead independent director Patrick Gaston as chairman, while Harriet Edelman, Harsha Ramalingam, Andrea Weiss, Mary Winston, and Ann Yerger would join the board as new independent directors. Co-founders and co-Chairmen Warren Eisenberg and Leonard Feinstein are expected to retire from the board as of May 1.

Read the article

4/22/2019

Bramson v Barclays: Big Week for Investor Before AGM Battle

The Guardian (United Kingdom) (04/22/19) Makortoff, Kalyeena

Edward Bramson, whose Sherborne Investors vehicle owns a 5.5% stake in Barclays (BCS), will ramp up his battle with CEO Jes Staley this week as he attempts to secure a board seat and force the company to scale back its investment banking division ahead of its May 2 annual meeting. His campaign was given a boost by Pirc, which advises pension funds and other investors, when it abstained on the matter for this year and said shareholders might be advised to vote for Bramson at the 2020 meeting. ISS and Glass Lewis, however, have voiced support for Barclays. Observers note that investors seem to agree with Bramson's assessment that, despite their patience during the bank's long overhaul, shareholders are not reaping large enough rewards. However, few investors believe Bramson should have a seat on the board, having raised concerns about his source of funding and lack of banking experience. According to Ian Gordon, a banking analyst at Investec, Barclays has given a "partial nod to Sherborne's concerns," adding, "Clearly Mr. Bramson would prefer to see more radical and targeted action to reallocate or release capital." Meanwhile, Sherborne said in its latest shareholder letter, "Our public investment record shows that we have consistently assisted boards, that were initially reluctant, to deliver major increases in value for all of the shareholders. We believe that, given mutual goodwill, and some change in perspective, Barclays offers similar opportunities."

Read the article

4/22/2019

SEC Investor Advocate Cautions on Proxy Adviser Controls

IR Magazine (04/22/19) Maiden, Ben

Rick Fleming, the Securities and Exchange Commission's (SEC's) investor advocate, sees little inclination among shareholders for change and has urged the SEC not to pursue reforms of the proxy advisory industry. "I think it is fair to say that investors are wary about efforts to regulate proxy advisers," Fleming told attendees at the annual "SEC Speaks" conference earlier in April. "Indeed, at the roundtable on the proxy process that the commission held last November, I think the investors made it pretty clear that they are relatively happy with the services they receive from proxy advisers," he said. "This is not to suggest that proxy advisers are perfect, but to the extent that any problems exist, it seems that their paying customers should be the ones to raise them. Investors certainly don't want those problems to be solved by injecting costly inefficiencies into an already-cumbersome process or by giving companies more opportunities to influence the advice that is given to investors about how they should vote." Investors who want a company's perspective on a shareholder proposal can already access its views in the board's recommendations to vote against the measure that are included in the publicly available proxy materials, he pointed out. These views may also be available in public correspondence with the SEC if the company tries to have the proposal excluded. "What [investors] want from a proxy adviser, and what they are paying for, is independent advice that fits within the parameters they have established for how they want to vote on various matters," he noted. Fleming acknowledged that there is widespread agreement that the proxy process needs attention—for instance, by making the basic structure of the voting system more efficient and reliable by looking into vote confirmation and records reconciliation. "But, absent a groundswell of concerns expressed by actual investors, I sincerely hope that the commission will not prioritize a rulemaking that could impair the independence of proxy advice or lead to even greater inefficiencies in proxy voting," he said.

Read the article

4/21/2019

Ancora Gets Its Engagement Together

Crain's Cleveland Business (04/21/19) Nobile, Jeremy

A record 935 public companies were engaged by investors globally last year, up from 609 in 2013. For Ancora Advisors, the strategy is fueled by increased levels of capital being put to work. "We have gone up the food chain because we have more assets to deploy," said Ancora Chairman and CEO Fred DiSanto. "And we're looking at names where clearly there has been some egregious intermingling of both board and management teams." Ancora, part of an investor group that owns 5% of Bed Bath & Beyond Inc. (BBBY), and fellow investors have been pressuring the retailer to replace its 12-person board, and the firm offered up 16 candidates for those board seats. "We just took a position and said we are going to be aggressive," DiSanto said. Meanwhile, the firm has sent a letter to J. Alexander's Holdings Inc. (JAX), where it has an 8.6% stake, offering to take the restaurant company private by acquiring it for $11.75 per share in cash, or $186 million. This marks the first time Ancora has pursued a public-to-private deal. DiSanto said, "Here's a company with a very good brand and good restaurants. They just need to be private." Meanwhile, Jim Chadwick, Ancora's director of alternative investments, noted, "In situations where there is a lack of cooperation from either management or the board, yet Ancora remains convinced that the stock is meaningfully undervalued based on unlocking potential catalyst events, then we would be taking a public-activist posture. We almost always start out constructive, and it's only when things break down we end up in filings."

Read the article

4/19/2019

Nuveen 2019 Proxy Season Preview

Harvard Law School Forum on Corporate Governance and Financial Regulation (04/19/19) Reali, Peter; Garcia, Anthony; Hewitt, Candace

Companies will likely face calls for greater transparency on board refreshment, climate change, and board diversity during the 2019 proxy season due to investors' intensifying demand for accountability on these issues, according to research from Nuveen. On the issue of board refreshment, investors are focused on whether the skills of the board are sufficient to address the growing risks of public companies. Nuveen expects investors to scrutinize the board refreshment track record and policies around future director recruitment to determine if there may be an oversight risk. A record 75 shareholder proposals related to climate change have been filed so far for 2019 annual meetings. Investors are now filing climate risk-related proposals at companies outside the energy sector, requesting companies report on the feasibility of adopting environmentally sustainable business strategies, and are expected to continue to encourage ambitious target-setting, such as achieving net zero emissions. Meanwhile, momentum from shareholder proposals and the wider societal focus on harassment and discrimination affecting workers will likely lead investors to focus more on broader employee-related diversity considerations. Shareholder proposals will likely request enhanced disclosure of detailed employee metrics or greater accountability on issues such as gender-diverse boards.

Read the article

4/19/2019

Shareholder Adviser ISS Backs Barclays in Bramson Battle

Financial Times (04/19/19) Crow, David; Walker, Owen

Institutional Shareholder Services (ISS) is siding with Barclays (BCS) in its battle over a board seat sought by Edward Bramson, stating that he has "not presented a sufficiently compelling case" in his campaign to convince other investors to vote him on to the board at the May 2 annual meeting. Bramson, whose Sherborne Investors vehicle holds a 5.5% stake in the U.K.-based lender, is calling on Barclays to boost overall returns by scaling back its underperforming investment bank. Meanwhile, Barclays CEO Jes Staley has pledged to protect Britain's last remaining global investment bank from further cuts. ISS said in a note to its clients on April 19, "The dissident campaign—which is built on a brief investor letter disclosed a few weeks before the annual meeting—falls short of what can reasonably be expected from a shareholder trying to address issues at a £28 billion systemically important bank." The proxy adviser also urged shareholders to give incoming Chairman Nigel Higgins more time to address the bank's issues, noting that he "seems acutely aware of investor discomfort with past performance." Glass Lewis also has recommended that investors vote against Bramson, citing his "questionable share ownership framework." The firm said, "While [Mr. Bramson's] current campaign should serve as something of a clarion call for management...we ultimately believe support for [his] proposal would entail considerably greater risk and uncertainty."

Read the article

4/19/2019

Bill Ackman Thanks Warren Buffett for Pershing Square's Turnaround

Yahoo! Finance (04/19/19) La Roche, Julia

Pershing Square Capital Management CEO Bill Ackman attributes his huge comeback to years of studying his mentor, Warren Buffett. Although the hedge fund is up more than 40% year-to-date, Ackman is not actively raising capital. At the 13D Active-Passive Investor Summit, Ackman noted that "one of the most instructive things" from his career has been reading the legendary investor's letters from the Buffett Partnership, the fund he ran before Berkshire Hathaway (BRK-A, BRK-B). After several years of outperformance, Buffett told his investors in May 1969 that he would close the partnership, giving partners the option to take their cash out or keep their investment for shares in Berkshire Hathaway. "A bunch of people wanted cash and spent another 50 years seeing their therapists for one of the dumber decisions that they made," Ackman said. "Since 1969, Berkshire is one of the greatest investments of all time. I think it's instructive. And, I think what Mr. Buffett realized in 1969 is that being a long-term investor with short-dated capital is just ultimately going to lead to a bad outcome at some point in time." He said the mission at Pershing Square is to have a permanent capital structure, and the firm took a step in that direction by launching a publicly-traded fund in 2014 with the long-term plan to have a majority of capital in that vehicle. Pershing Square Holdings (PSHZF), the public vehicle, now represents 80% of the firm's capital.

Read the article