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Pernod Names Lead Independent Director
" Reuters (01/23/19) Vidalon, Dominique; Denis, Pasquale"

Pernod Ricard, which has been engaged by Elliott, said Jan. 23 it has named business veteran Patricia Barbizet to the newly created role of Lead Independent Director to further boost its governance. Elliott disclosed in December that it had just over a 2.5% stake in Pernod Ricard. The board of the French spirits manufacturer also approved the departure of longtime family ally and former CEO Pierre Pringuet from his current role as vice chairman of the board. However, he will stay on as a board director, the company said in a statement. "The decision taken by the board to create the role of Lead Independent Director is the continuity of a thought-process that started in July 2018," said Chairman and CEO Alexandre Ricard. It followed "the triennial external review of the board and the feedback we've received from our long-term shareholders," Ricard noted. Elliott is urging Pernod Ricard to increase its profit margins to bring them more in line with competitor Diageo (DEO) and improve governance. Elliott says the 15-member board needs to be more diverse and have more independent voices; many of its directors have ties to the Ricard family.

The $15 Billion Arconic Buyout That Wasn't
" Bloomberg (01/22/19) Sutherland, Brooke"

Arconic (ARNC) has decided not to sell the company. According to Reuters, the maker of metal parts for airplanes and cars rejected a $22.20 offer from Apollo Global Management, which would have implied a valuation of more than $15 billion, including debt. Chairman John Plant said the company did not feel the takeover proposals it had received were in the "best interests of Arconic's shareholders and other stakeholders." Employees, suppliers, and customers could have been worse off, but shareholders would have preferred a deal, writes Brooke Sutherland. Elliott Management, Arconic's largest shareholder, has been increasingly involved at the company. The investor successfully pushed for the ouster of Arconic CEO Klaus Kleinfeld in 2017 and overhauled the board, eventually adding one of its own portfolio managers. Elliott was willing to roll its equity stake into an Apollo-led buyout and buy a majority interest in a spinoff of Arconic's cladding business as a means of helping to mitigate potential liabilities from the Grenfell Tower fire. Elliott based its campaign around the idea that it had better ideas than management about how to run the company and could guide it to a stock price between $33 and $46 a share, according to Sutherland, and now gets a shot to prove that.

Hedge Fund Drops Proxy Battle With Chemicals Maker Ashland
" Wall Street Journal (01/22/19) Thomas, Patrick"

Ashland Global Holdings Inc. (ASH) has reached an accord with Cruiser Capital Advisors LLC. The hedge fund, which owns a 2.5% stake in the company, will withdraw its slate of nominees to Ashland's board and instead back the company's nominees at an annual shareholder meeting in February. Ashland will also appoint Dr. William H. Joyce as a consultant to the company on operational matters. In his new role, Joyce will work closely with Ashland Chairman and CEO William Wulfsohn and report his recommendations to Ashland's board. Cruiser Capital nominated four directors to Ashland's board in October, seeking to oust four current board members. The hedge fund had also urged shareholders not to re-elect Wulfsohn as chairman. Cruiser Capital had previously criticized Wulfsohn and other board members for weak earnings growth and its corporate-governance practices. The fund had also called for Ashland to broaden its cost-cutting program and boost margins. "We believe that Ashland has made significant positive corporate governance and board leadership changes," said Keith Rosenbloom, managing partner of Cruiser Capital. Ashland and Neuberger Berman, which owns a 2.8% stake in the company, last week agreed on a plan in which the company will add two new directors after its annual meeting, refresh leadership of its board committees, and have a longtime director resign. Under the plan with Neuberger, Wulfsohn will remain chairman, but current director Jay Ihlenfeld will be appointed lead independent director. Ashland on Jan. 22 said its board will appoint either Craig Rogerson and Jerome Peribere or both to the governance committee of the board after the shareholder meeting. Ashland named Peribere to the board last year upon a recommendation by Cruiser Capital.

Rices Say They'll Take Their Plan to EQT Shareholders
" Pittsburgh Business Times (01/22/19) Gough, Paul J."

A couple of former Rice Energy Inc. (RICE) executives ratcheted up the pressure on EQT Corp. (EQT), petitioning shareholders to replace board members and support former Rice President Toby Rice as CEO. Toby Rice and Derek Rice were responding to EQT's announcement Jan. 22 of a more detailed look at a capital spending plan that prioritizes free cash flow and improving efficiencies. The Rices made a proposal to EQT's board of directors a week ago that both sides said included "a lot of back and forth" on the Rices' turnaround plan. The Rices have issued a statement that reads: "In light of EQT's unwillingness to acknowledge the fundamental change needed to achieve acceptable results for the benefit of all shareholders, we will be asking shareholders to reconstitute the board with new board members who better understand EQT's industry and business and will support Toby Rice as CEO."

Elliott Thinks Walmart, Google and Private Equity Could Be Interested in Buying eBay’s Core Marketplace Business for About $15 Billion, Source Says
" CNBC (01/22/19) Sherman, Alex"

Elliott Management believes Walmart (WMT), Google (GOOGL), or several private equity firms would be interested in acquiring eBay’s (EBAY) marketplace business if it sheds StubHub and eBay Classifieds Group, according to a source. Elliott disclosed a more than 4% stake in eBay in a letter Tuesday and offered recommendations for the company, including spinning off StubHub and eBay’s portfolio of classified advertising properties. Starboard Value LP has also acquired a stake in eBay and plans to speak to the company about similar changes, said another source. EBay has a market valuation of more than $31 billion. If eBay is able to separate StubHub and the classifieds business, the remaining marketplace business could be a more realistic size for a private equity transaction. EBay’s marketplace business generated $2.1 billion of revenue in the third quarter. StubHub took in $291 million in sales and the classifieds unit booked $254 million. Elliott expects the Classifieds Group could sell for between $8 billion and $12 billion and estimates StubHub could secure between $3.5 billion and $4.5 billion. If EBay sells the marketplace business without operational improvements, Elliott anticipates it could fetch about $15 billion, a source said.

StanChart Chief Pushes Back on Report That Its Biggest Shareholder Is Unhappy
" CNBC (01/23/19) Browne, Ryan"

Standard Chartered (SCBFF) CEO Bill Winters on Wednesday denied a report that its biggest shareholder is unsatisfied with his restructuring efforts, stating Singapore's state-owned investment arm Temasek is in fact “very supportive” of the company. Temasek has been putting the bank under pressure, requesting more frequent briefings from executives and even considering a position on the firm's board, the Financial Times newspaper reported Monday, citing sources. But Winters on Wednesday resisted that report, saying “I'd be surprised if I read anything in the Financial Times which I hadn't heard from them directly.” Temasek has “been a very supportive shareholder throughout,” he said at the World Economic Forum in Davos, Switzerland. “We have an extremely active dialogue with all of our large shareholders, of course including Temasek.” The FT also reported that Temasek would prefer an external replacement for Winters once he resigns and highlighted Piyush Gupta, CEO of Singaporean bank DBS, as a preferred replacement. Temasek currently owns an almost 16% stake in the bank, according to Standard Chartered's latest filing. The bank's share price has declined more than 40% since Winters took over in 2015. Winters said StanChart's share price is “not where we want it to be” and that it knows it has “further to go” in its turnaround plan.

Starboard, Elliott Management Call on eBay to Shed StubHub, Classifieds
" Wall Street Journal (01/22/19) Lombardo, Cara; Chin, Kimberly"

Starboard Value reportedly has joined Elliott Management Corp. in urging EBay Inc. (EBAY) to consider shedding its StubHub ticketing and classified-ads businesses. Elliott announced Tuesday that it owns a more than 4% stake in eBay and urged the e-commerce company to consider spinning off or selling the units because they could be worth more on their own. Meanwhile, Starboard has a stake in eBay of less than 4% and has spoken to the company about those same changes, according to a source. Starboard bought the stake at least six months ago and has been talking to EBay in recent months about improving its operations and potentially separating the two businesses similar to the way it previously spun off payment platform PayPal Holdings Inc. (PYPL), the source said. Shares of eBay were up over 8% in early trading after being down roughly 20% over the past year through Friday. EBay said it values shareholders' input and will carefully review Elliott's proposals. The company faced pressure in 2014 from Carl Icahn, and later spun out PayPal, which is now itself a company worth more than $100 billion. Icahn sold out of his eBay position soon after the split and last year exited his stake in PayPal, with it having roughly doubled in value since the spinoff.

Exclusive: Private Equity Firms Circling Nestle's Skin Health Business - Sources
" Reuters (01/21/19) Schuetze, Arno; Barbaglia, Pamela; Geller, Martinne"

Private equity firms Cinven and Advent have teamed up to bid in an auction for Nestle's skin health business, according to people familiar with the matter. Blackstone (BX), KKR (KKR), Carlyle (CG), CVC, EQT (EQT), and Partners Group are also expected to bid and might look for partners. Nestle, which is shedding underperforming businesses and facing criticism from an investor who is pushing for an overhaul, launched a review of the business in September. Information memorandums on the skin health business sale, being run by Credit Suisse and Evercore, are expected to be sent by the end of January; first-round bids are likely to be submitted in early March. The business could have a price tag of about 7 billion Swiss francs ($7 billion). Industry players that might take part in the auction include Beiersdorf, Allergan (AGN), Henkel, Johnson & Johnson (JNJ), L'Oreal, Pfizer (PFE), and Unilever (UN). The Skin Health unit has performed poorly since its creation in 2014, which has led to one-off costs and restructuring.

Amber Road Inc. Confirms Receipt of Director Nominations
" Business Wire (01/22/19)"

Amber Road Inc. (NYSE), a provider of cloud-based global trade management solutions, has received notice that Altai Capital Management L.P. intends to nominate two candidates for election to Amber Road's board of directors at the 2019 annual meeting. Amber Road says its board "will review the nomination notice, evaluate the candidates, and continue to engage appropriately."

EQT Rejects Rice Proposal to Shake Up Management
" Wall Street Journal (01/22/19) Matthews, Christopher M.; Prang, Allison"

On Jan. 22, EQT Corp. (EQT) CEO Robert McNally said on a call with investors that the company rejected a plan by the brothers who founded Rice Energy Inc. and sold it to EQT in 2017 to take over running the combined company. McNally said their plan is based on flawed assumptions and lacks detail. He also announced that EQT is taking additional cost-cutting steps, forming a board committee to review its operations, and searching for a new COO. Daniel, Toby, and Derek Rice—who as a family control about 2.7% of EQT's stock—have said they should run the company and can bring down drilling costs and increase natural-gas production at EQT. They have the support of Elliott Management Corp., and at least two top 10 shareholders, including D.E. Shaw Group, also have voiced support. McNally said in an interview following the call that he was willing to engage with the Rice team, noting that "I think we'll get to the point where there's just no need for a proxy fight."

Arconic Plunges After Walking Away From Apollo's Buyout Offer
" Bloomberg (01/22/19) Clough, Rick; Porter, Kiel"

Shares of Arconic Inc. (ARNC) fell the most in eight months after the board rejected a sale of the company. Apollo Global Management had been in talks to buy Arconic for $22.20 a share, valuing the company at about $10.7 billion. It would have been one of the biggest leveraged buyouts since the global financial crisis. Sources say Apollo had secured financing for the offer, which included coverage of potential liabilities related to London's deadly 2017 Grenfell Tower fire. According to Arconic Chairman John Plant, "We did not receive a proposal for a full-company transaction that we believe would be in the best interests of Arconic's shareholders and other stakeholders." The end of the negotiations adds to the uncertainty surrounding Arconic, which during the last two years has waged a proxy battle with Elliott Management Corp., replaced its CEO, and drawn unwanted attention for its connection to the London fire. The company said it would shift its focus to operational improvements and the previously announced sale of the building-systems unit.

Bunge Warns on Profits and Names Interim Chief
" Financial Times (01/22/19) Meyer, Gregory; Hume, Neil"

Bunge (BG) has appointed Gregory Heckman as acting CEO, replacing Soren Schroder, who agreed to leave the world's largest oilseed processor in December. The move comes 12 weeks after Heckman was added to the board in a deal with Continental Grain and DE Shaw. Three other directors were added to the board in October under the settlement, which also triggered a strategic review of the company. Bunge said it would continue to search for a permanent CEO and said three of its longest-serving board directors—Patrick Lupo, Ernest Bachrach, and Enrique Boilini—would not stand for re-election this year.

ABB Planning More Deals to Expand in Robotics, CEO Tells NZZ
" Bloomberg (01/19/19) Torsoli, Albertina"

In an interview with Neue Zuercher Zeitung, ABB (ABB) CEO Ulrich Spiesshofer defended his decision to hold on to the Swiss company's power grids business until now. Spiesshofer in 2016 defied investor Cevian Capital, which had been calling for a break-up of the engineering giant for years. The unit can be sold now only because it was revamped and "we no longer have to act from a weak position," according to Spiesshofer. ABB is selling the business to Hitachi. Spiesshofer said ABB is simplifying its organization structure in an attempt to improve efficiency. In an interview with Bloomberg Television, Lars Forberg, managing partner at Cevian, said the investment firm "fully supports" the reorganization of ABB. The company also plans to pursue more acquisitions to expand in robotics and industrial automation. In December, Spiesshofer told Bloomberg he had the "financial horsepower" for more deals.

Elliott Says Urgent Changes Are Needed at eBay in Letter to Board
" Bloomberg (01/22/19) Schuetz, Molly"

Elliott Management Corp. penned a letter to the board of EBay Inc. (EBAY) detailing steps it says are “urgently needed” to boost the value of the online marketplace. Elliott, which owns more than 4% of EBay, proposed a five-step plan that involves reviewing EBay’s portfolio of companies, including StubHub, revitalizing the company’s Marketplace, which Elliott considers poorly managed, and returning capital to shareholders. If its recommendations are followed, Elliot sees EBay’s shares valued at $55 to $63 a share, potentially doubling their value from Friday’s close. “Despite its remarkable history as one of the world’s largest e-commerce platforms, EBay as a public-company investment has underperformed both its peers and the market for a prolonged period of time,” Elliott wrote in the letter. It said that EBay management should focus on “growing and strengthening Marketplace,” which Elliott says has weathered “prolonged, self-inflicted misexecution.” In addition, Elliott said EBay needs to increase “operational efficiency,” and also recommends that EBay accelerate its share repurchase plan to $5 billion this year.

Elliott Sends a Signal to Dixons Carphone
" The Times (London) (01/22/19) Clarence-Smith, Louisa"

Elliott Advisors reportedly is considering taking a sizeable position in Dixons Carphone (DSITF) after the electronics retailer's share price tumbled 40% last year. Shares moved higher on reports that the investor has been conducting a detailed analysis of the company's finances for several weeks. Dixons Carphone CEO Alex Baldock implemented a turnaround strategy after the company reported a £440 million pre-tax loss compared with a profit of £54 million in 2017. Observers indicate that Elliott, if it decides to build a stake, could pressure the company to sell some of its more lucrative assets.

U.K. Meal Delivery Firm Just Eat and CEO Go Separate Ways
" Reuters (01/21/19) Sandle, Paul"

Just Eat (JSTTY) CEO Peter Plumb is resigning with immediate effect, just 16 months after he joined the British takeaway ordering website and launched an investment drive that slowed earnings growth. Plumb upgraded Just Eat’s technology and launched its own delivery service to address intensifying competition from Deliveroo and Uber Eats. But the new strategy has demanded more and more investment, causing earnings momentum to slow sharply, and shareholder Cat Rock Capital Management complained last month the company had become the world’s worst performing online food delivery stock. Cat Rock said in December that Just Eat should consider selling businesses such as its stake in Brazilian market leader iFood. It also wanted executive bonuses tied to a three-year performance plan. Cat Rock's founder and managing partner Alex Captain said Just Eat's board had recognised that change was badly needed. “It is critical that the board now find a high-quality successor and implement a remuneration plan that creates clear alignment with shareholders' interests,” he said. Liberum analysts said the reasons behind Plumb's departure were unclear, with one possible explanation being a boardroom dispute over the Latin American strategy. But they were encouraged by the company's commitment to raise core earnings margins from 2019 onwards. “This was one of Cat Rock's calls and will be taken well by shareholders generally who were concerned that the investment may have become a bottomless pit,” they said. Just Eat could also now become a target for buyers, they added, following recent activity in the sector.

Elliott Calls on Telecom Italia to Press Ahead With Full Network Split
" Reuters (01/21/19) Piovaccari, Giulio"

Elliott has called on Telecom Italia’s (TI) board to spin off its fixed-line network, after Italy’s telecoms regulator spurned a Vivendi plan to create a wholly-owned subsidiary instead. AGCOM announced Sunday that the proposal by former CEO Amos Genish, appointed when French media group Vivendi controlled Telecom Italia’s board, would not reduce the power it has over the market. Elliott and Vivendi are locked in a battle over how to relaunch the debt-laden former Italian telecoms monopoly after the U.S. fund last year won control of Telecom Italia's board away from Vivendi. The watchdog's decision confirmed that Vivendi's plan, in allowing the company to retain full control of the network, did not materially change the market situation, Elliott said. The fund aims to separate the network into a newly created company and then sell part of it. Telecom Italia warned last week of a fall in 2018 profit and said its domestic business would remain under pressure, reigniting tensions between its two top shareholders.

Top Flybe Shareholder Threatens Legal Challenge Over £2m Bid
" Sky News (01/19/19) Kleinman, Mark"

Hosking Partners, Flybe's top shareholder with a nearly 19% stake, has launched an attack on the board of directors, accusing them of breaching their duties to investors and threatening a legal challenge to the takeover of one of Britain's best-known airlines. The London-based asset manager reportedly has instructed lawyers to explore its options in relation to the company's proposed sale to a consortium led by Virgin Atlantic Airways. These options could include attempting to obtain an injunction prohibiting the deal from being completed, Hosking Partners reportedly warned Flybe's management last week. The initial 1p-a-share deal came at a huge discount to the airline's share price. In a letter to Flybe's board, Hosking Partners reportedly expressed concern that they had allowed a false market in the company's shares to develop by failing to update the City on its financial position in a timely fashion. The fund manager also reportedly questioned whether the £2.2 million offer reflected the intrinsic value of Flybe, and alleged that the handling of its proposed sale had blocked a rival offer from emerging at a higher price. A Hosking Partners spokesman noted that investors were "entitled to transparency over precisely what has gone on to drastically reduce Flybe's value."

Responding to Investor, MDC Sets Date for Annual and Special Meeting
" (01/18/19) Graham, Megan"

Advertising holding company MDC Partners (MDCA), which is weighing a sale and looking for a new CEO, has established a June date for a combined annual and special meeting of shareholders. The move follows one of its significant shareholders recently announcing its intention to call a special meeting to replace three current MDC board members. FrontFour Capital Group sent a letter Dec. 31 saying it and MDC had "reached an impasse." The letter said FrontFour was left with no choice but to requisition a special meeting of shareholders to be held no later than March 29. MDC on Jan. 18 said it has set the combined annual and special meeting of shareholders for June 4. "The board of directors of the company has determined that, rather than incur the additional expense and disruption that would be associated with holding two shareholder meetings in quick succession, it would be in the best interests of the company to hold the requisitioned meeting at the same time as the annual meeting takes place in June," a statement said. MDC said its board also has backed an adoption of an advance notice bylaw, "establishing a framework requiring advance notice for the nomination of directors by shareholders of MDC Partners." The advance notice requirement is effective immediately and will be brought before shareholders for confirmation at the June meeting, MDC said.

Japan Eyes Forcing Governance Reforms at Firms After Ghosn's Arrest
" Japan Today (Japan) (01/20/19)"

Major Japanese companies should be compelled to appoint at least one independent director to ensure proper corporate governance, a government panel has recommended.  The proposal by a subcommittee of the Justice Ministry's Legislative Council comes as analysts point out insufficient regulatory steps following the recent arrest of former Nissan Motor Co. Chairman Carlos Ghosn, as well as a number of scandals involving improper product inspections at big manufacturers.  Council members expect to submit a draft revision of the Corporate Law to Justice Minister Takashi Yamashita in February.  The new rule would apply to companies with liabilities of 20 billion yen or more or with capital of at least 500 million yen.  Among companies listed on the Tokyo Stock Exchange, 97.7% have at least one independent board member as of July 2018.

Alden/MNG Prepares to Run Activist Slate for Gannett Board Seats
" New York Post (01/17/19) Kelly, Keith J."

Sources say Alden Global Capital, the hedge fund that controls MNG Enterprises, is preparing to run an activist slate of candidates to pressure the board at Gannett (GCI) if it balks at the $1.36 billion takeover offer. Gannett said it received the unsolicited bid from MNG on Jan. 15, but pledged only to review the $12-a-share offer. In its offer letter, MNG Chairman Joe Fuchs writes, "If the board refuses to engage with us in good faith and in a timely fashion, we reserve our rights to take action to protect the value of our investment, which may include seeking changes to the composition of the board." Sources say Alden expects the company to balk at the offer. The deadline for nominating new board members at Gannett is Feb. 7.

Luby's Will Add Two to Board Amid Pressure From Hedge Fund Investor
" Reuters (01/18/19) Herbst-Bayliss, Svea"

On Jan. 18 the casual dining chain Luby's Inc. (LUB) said it will shake up its board, inviting two new independent directors to replace two sitting members and selecting a new chairman. The announcement comes a week before shareholders will vote on whether to add nominees from Bandera Capital, which owns nearly 10% of the company's shares, to the board. "Luby's has recently been engaged in in-depth discussions with many of our shareholders, and based on the feedback we have received, we have chosen to accelerate our plans to transform the board," said Chairman Gasper Mir III, who plans to remain on the board but give up his role as chairman. Jeff Gramm's Bandera has criticized the company's high expenses and is urging other investors to back its demands for more accountability and oversight by the nine-member board. ISS recommended electing Gramm and his father, former Sen. Philip Gramm, to the board, while Glass Lewis recommended adding only Jeff Gramm.

Bandera Partners Issues Letter to Luby's Stockholders
" MarketWatch (01/18/19)"

Bandera Partners LLC's Jeff Gramm penned a letter to fellow shareholders of Luby's Inc. (LUB) on Jan. 18 warning them not to be fooled by the company's recent actions. "Just over 10 years ago, when Luby's was engaged in a tight proxy contest with an activist investor, the incumbent board instituted some long overdue governance changes to swing votes back in their favor," the letter stated. "Luby's incumbent board narrowly won that contest, and the stock has since fallen over 80% under its watch. Don't let them fool you twice with their latest round of promises." It added that following significant support for Bandera's case that the board has grossly underperformed, "Luby's is proposing a new round of changes and sweetened promises, including swapping in new directors, hand-picked by the underperforming incumbent board, AFTER the election, with an uncertain timeline." Bandera says it does not believe Luby's stockholders will fall for these tactics for a second time, and encourages them to instead vote for its own nominees. "If the newly elected Board wishes to discuss additional board refreshment this coming year, we will welcome that discussion. Today's announcement from Luby's is simply too little too late."

Apollo Close to $10.6B Deal to Buy Arconic
" New York Post (01/17/19) Kosman, Josh"

Apollo Global Management (APO) reportedly is close to a deal to buy Arconic (ARNC) for $10.6 billion, or about $22 a share. Arconic has not yet approved the deal, but sources say the aluminum giant told Apollo and the company's top shareholder Elliott Management to finish the necessary paperwork so it can clear the deal this weekend. The deal would be one of the biggest leveraged buyouts since the 2008 financial crisis. To get the deal done, sources say Elliott has agreed to take on the risks stemming from the 2017 Grenfell Tower fire in London by acquiring majority control of the construction division saddled with the Grenfell liabilities. However, they note that the hedge fund has argued with two other prospective bidders, Blackstone Group and Carlyle Group, about the size of the guarantee it would provide. One of the sources said Elliott was planning to put forward much less than the $1 billion-plus that Blackstone and Carlyle felt would be needed to protect Arconic from potential litigation, but now the deal will include more than $1 billion to cover potential liabilities; however, that may include insurance.

MGM Hands Board Seat to Hedge Fund Corvex's Meister
" Reuters (01/17/19) Herbst-Bayliss, Svea; Roumeliotis, Greg"

MGM Resorts International (MGM) has reached a deal with Corvex Management to appoint its founder, Keith Meister, to the board on Friday, expanding it from 12 to 13 members. The agreement comes after recent reports that Starboard Value had built a position in the casino operator and was considering pushing for changes. MGM's chief executive and chairman, Jim Murren, said the company and Meister have been holding “constructive dialogue” over the last several months, and he praised the investor's track record of “helping companies maximize value for shareholders as well as his experience in real estate and gaming.” Corvex owns about 3% of MGM's stock. “It is clear to me that MGM is focused on driving profitable growth,” Meister said, adding that he believes he can help. Since 2017, MGM said it has appointed four new independent directors, including Meister.

Trian to Skip PPG Board Challenge After New Commitments: Sources
" Reuters (01/17/19) Herbst-Bayliss, Svea; Roumeliotis, Greg"

Trian Fund Management LP will not challenge PPG Industries Inc.’s (PPG) board of directors at its 2019 shareholder meeting after the company met some of the hedge fund’s demands and announced new financial targets, sources said Thursday. Trian asked PPG last October to replace its CEO Michael McGarry with former CEO Chuck Bunch, examine how it uses its balance sheet, consider a break-up of the company, and put the board up for re-election every year. PPG presented financial targets for 2019 on Thursday and said it would explore separating its architectural from its industrial coatings, as well as destagger its board and remove super majority voting. The company also said Thursday that the U.S. Attorney's office for the Western District of Pennsylvania is looking into improper accounting practices from 2017 into which the U.S Securities and Exchange Commission (SEC) opened a probe in June. PPG on a conference call with analysts said it was fully cooperating with the investigation. Trian will not submit its own nominees to challenge PPG's board of directors at the company's upcoming shareholder meeting, the sources said. The deadline for nominations is at the end of this week.

Elliott Investment Pernod Pledges to Further Improve Governance
" Reuters (01/18/19) Vidalon, Dominique; Denis, Pascale"

French spirits group Pernod Ricard (PDRDY) on Friday vowed to improve its governance, amid pressure from Elliott. The statement follows news reports the company was likely to make board changes, a move Jefferies analysts said would be an “early win” for the hedge fund. Elliott in December unveiled a roughly 2.5% stake in Pernod and has called on the company to raise profit margins and improve governance. It believes Pernod's 14-member board needs to be more diverse and have more independent voices, as many directors are linked to the Ricard family. So far, the two sides have described talks as cordial and constructive. Yet there are doubts that Elliott can change much as the Ricard family controls 15% of Pernod's shares and 21% of voting rights, while long-time investor GBL owns a 7.5% stake and has said it backs the firm's strategy. The French state also warned in December it wanted “big French companies to have stable and long-term shareholders” and not to be “subject to pressure from shareholders who want short-term profitability.” One unknown is why Elliott is so far taking a less confrontational approach with Pernod than with some other investments. Sources say Elliott could be testing a new template for negotiations with other French companies.

Telecom Italia Profit Warning Exposes Shareholder Divisions
" Reuters (01/18/19) Flak, Agnieszka"

Tensions between Telecom Italia’s (TIM) top two shareholders intensified Friday after the Italian phone group warned of a decline in 2018 profit and said its domestic business would remain under pressure this year. In an unscheduled release of preliminary results late Thursday, TIM said it expects to report 2018 organic core earnings of around 8.1 billion euros ($9.2 billion). The figure represents a drop of less than 5%, a source said, despite an improvement in its Brazilian unit. TIM has been mired since early last year in a battle between shareholders Vivendi and Elliott over how to revive the embattled company. Vivendi, which owns 24% of TIM, again criticized Elliott over TIM's poor results. “We are very, very angry because there's been a lot of time wasting since Elliott took over ... we are concerned there is no plan in place and they are putting the blame on the previous management,” a spokesman for the French media group said. Vivendi and Elliott will again face off on March 29 when shareholders are asked to vote on Vivendi's request to replace five of the Elliott-appointed directors. The French investor also pledged to call another shareholder meeting in the summer if results do not improve.

Gulfport Pledges Share Buybacks After Hedge Fund Demand
" Reuters (01/17/19) Herbst-Bayliss, Svea"

Natural gas and oil firm Gulfport Energy Corp. (GPOR) Thursday said it will buy back $400 million of shares, just hours after Firefly Value Partners called for it to do so, arguing that a large share buyback could spark a doubling of Gulfport's share price. Firefly has an 8.1% stake in Gulfport. Gulfport said it will buy back the shares in the next two years and said it bought $90 million worth of shares at the end of 2018. "I want to underscore our commitment to further enhancing shareholder value with a newly authorized $400 million stock repurchase program to be executed within the next 24 months," stated CEO David Wood. Firefly had said Thursday morning it wanted Gulfport, which has a market capitalization of $1.5 billion, to buy back $500 million of shares. Firefly criticized how Gulfport had allocated capital and noted that current board members might not be committed to pushing for improvements. The hedge fund said directors do "not seem up to the task of fixing the company's capital allocation strategy and regaining investors' trust," adding that it may be time to add a shareholder to the board who can encourage the group to call for these changes. "We propose an action plan that we believe allows Gulfport to create at least $9 per share of value for stockholders (over 100% of the current market capitalization) over the next 12 months," Firefly's letter said.

Pernod Ricard to Reshuffle Board After Elliot Takes Stake—Report
" Reuters (01/17/19) White, Sarah"

Pernod Ricard (PDRDY) reportedly will reshuffle its board in the coming weeks, following Elliott's December disclosure that it had built a stake of slightly more than 2.5% in the French family-backed spirits group. Among those who could take a step back is Vice Chairman Pierre Pringuet. The hedge fund has called on Pernod Ricard to improve its profit margins and governance, deeming that the board was too close to the Ricard family. Sources say Elliot and Pernod managers met on Jan. 15 and agreed to continue discussions.

Premier Foods Names Acting Boss Amid Sales Woes
" Belfast Telegraph (Ireland) (01/17/19)"

Premier Foods (PFODF) announced that CFO Alastair Murray will serve as interim CEO, effective Feb. 1, replacing Gavin Darby, who is leaving at the end of the month in the wake of pressure from Oasis Fund Management. His departure comes just months after he narrowly survived a shareholder rebellion against his re-election. The company also reported that group sales dropped 2.2% in its third quarter and that it remains in talks about a potential sale of its Ambrosia brand and its factory in Lifton, Devon. Darby said, "We faced into two sets of challenges in the quarter—lower international sales and our logistics program, which as expected, affected cake sales volumes early in the quarter. As we look to the fourth quarter, we expect to see a good performance from branded sweet treats, we have a good innovation plan lined up, and our expectations for trading profit and adjusted earnings per share for the full year are unchanged."

Gulfport Board Faulted, Share Buybacks Sought by Investor
" Bloomberg (01/17/19) Deveau, Scott"

Firefly Value Partners, which said it owns an 8.1% stake in Gulfport Energy Corp. (GPOR) sent a letter to the board on Thursday calling for changes at the natural gas and oil company. The investment firm said Gulfport's board lacks the experience needed to fix its poor performance and that it should implement a $500 million share buyback program to double its stock price. “We are concerned that the current board does not possess the necessary skills, experience, or alignment with the company's stockholders to effectively steer Gulfport's strategy and maximize long-term shareholder value,” Firefly wrote. The investor wants to work with the company on shaking up the board, sources said, but will consider nominating its own directors if that effort fails. Gulfport confirmed Thursday that it had received the letter, which it said followed talks with the firm. Firefly argues the company—whose shares were trading around $8 Thursday and have dropped 32% in the past year—could be worth more than $30 per share over time if it takes steps to improve its performance. Based on its conversation with Gulfport Chairman David Houston, Firefly said it's concerned that the board won't commit to actions needed to improve value despite a strong cash position and being one of the lowest cost producers of natural gas in the country.

PPG Paints Itself Into a Corner
" Wall Street Journal (01/17/19) Wilmot, Stephen"

PPG Industries (PPG) said Jan. 17 it would consider splitting its architectural paints used for buildings from its industrial ones, which cover cars, aircraft, and the like. Trian Fund Management last October revealed a 2.9% stake and called for a "strategic review of the portfolio," the ouster of Chairman and CEO Michael McGarry, and corporate governance reforms. Two years ago, PPG seemed a beneficiary of activism rather than a victim. It made three bids for underperforming European competitor Akzo Nobel and was supported by leading Akzo shareholder Elliott Management. But Akzo Nobel fended them off, forcing the hedge fund to call for a portfolio split instead. Soon thereafter, PPG's fortunes began to slip with the revelation of accounting irregularities followed by a substantial profit warning. The company now likely must acquiesce to Trian.

PPG Weighs Splitting Building and Product-Coating Units
" Wall Street Journal (01/17/19) Hufford, Austen"

PPG Industries Inc. (PPG) announced it is conducting a review of its paint and coatings business that could result in a split of the company, following pressure from Trian Fund Management LP. PPG makes coatings and paints of two kinds: for walls and rooms of buildings and homes; and for products such as cars and smartphones. The company said it would decide whether those architectural and industrial coatings businesses should be separated by the end of the second quarter. PPG in recent years sold and spun off assets to focus on those two businesses. Trian, who reportedly owns a 2.9% stake in the company, has called for PPG to be broken up along those lines and for CEO Michael McGarry to resign. PPG said that month that its board unanimously supported McGarry. “We are very appreciative of the input and constructive dialogue that we have with all of our shareholders,” said McGarry, without specifically mentioning Trian. Jean-Marie Greindl, PPG's head of architectural coatings, departed on Jan. 9, though the company did not reveal why. PPG's shares fell 2% in premarket trading on Thursday as the company also said it saw slowing global economic growth and demand declines for its products in some countries.


Roundtable: Shareholder Activism and Engagement
" Financier Worldwide (02/01/19)"

During a Financier Worldwide roundtable discussion on shareholder activism and engagement, Jonathan Feldman, a partner at Goodmans, said the most significant development over the past 12 months is that activists now feel emboldened to look for wholesale change at companies, prompting them to become more proactive in communicating with shareholders. Some of the common issues raised by activists are the need to improve performance, return capital to shareholders, oppose an M&A deal, and support a sale of the company or spin-off, said Charles A. Koons, managing director of Morrow Sodali. Looking around the globe, Richard J. Grossman, partner at Skadden, Arps, Slate, Meagher & Flom, noted that the European Union recently amended the Shareholders' Rights Directive to encourage shareholder engagement, while adding that shareholders in Asian companies have become more amenable to direct and more active engagement. "Perhaps the most effective tactic that has evolved as a result is the recruitment of well-qualified, experienced dissident director candidates, often with the help of headhunters, who are able to withstand, if not surpass, comparisons with incumbent directors," said Arthur B. Crozier, chairman of Innisfree M&A. Companies will need to think more like activists in order to anticipate the onset of a campaign, said Feldman. They should consider conducting a vulnerability assessment, according to Grossman, while Crozier said it is important for companies to understand their shareholder base. Koons expects the globalization of the shareholder base to accelerate, market volatility to present more opportunities for activists, and shareholders of all types to demand greater insight into a company's long-term strategic vision.

Directors: Older and Wiser, or Too Old to Govern?
" Harvard Law School Forum on Corporate Governance and Financial Regulation (01/22/19) Masulis, Ronald; Wang, Cong; Xie, Fei"

The boards of U.S. public corporations have become notably older due to recent governance reforms, a rise in shareholder activism, and firms placing limits on how many boards a director can sit on. From 1998 to 2014, the median age of independent directors at large U.S. firms rose from 60 to 64, and the percentage of firms with a majority of independent directors age 65 or above nearly doubled from 26% to 50%. Ronald Masulis, a professor of Finance at the University of New South Wales Australian School of Business, and colleagues, have analyzed a sample of S&P 1500 firms over this period and report older independent directors (OID) exhibit poorer board attendance records and are less likely to serve as the chair or a member of an important board committee. As the percentage of OIDs on corporate boards rises, excess CEO compensation increases. A greater OID presence on corporate boards is associated with firms having lower financial reporting quality, poorer acquisition profitability measured by announcement returns, less generous payout policies, and lower CEO turnover-to-performance sensitivity. The negative relation between OIDs and firm performance is more pronounced when OIDs hold multiple outside board seats. However, the analysis also revealed that for firms with high advisory needs, the relation between OIDs and firm performance is no longer significantly negative and in some cases, becomes positive.

Corporate Governance Survey: 2018 Proxy Season
" Harvard Law School Forum on Corporate Governance and Financial Regulation (01/22/19) Bell, David A."

Fenwick & West's annual survey of corporate governance practices reveals some significant differences between publicly traded companies in the Standard & Poor's 100 Index (S&P 100) and publicly traded technology and life science companies in the Silicon Valley 150 Index (SV 150). Adoption of dual-class voting stock structures is a recent clear trend among the SV 150, rising to 13% last year from 10.9% in 2017, but remaining at 9% over the past three years for the S&P 100. Classified boards are significantly more common among the SV 150, holding steady at 50.7% last year, but dropping to 3% from 4% in 2017 for the S&P 100. Implementation of majority voting has risen from 10% to 95% between the 2004 and 2018 proxy seasons among the S&P 100, compared to an increase from zero to 57.9% between 2005 and 2018 for the SV 150. The prevalence of stock ownership guidelines has generally increased over time in both groups, but the SV 150 only recently surpassed the level of the S&P 100. In the SV 150, increasing numbers of women directors and declining numbers of boards without women members are long-term trends. Most companies in the SV 150 would meet California's new standard mandating inclusion of women on boards of directors in 2019. There continues to be a general decline in the average number of executive officers per company in both groups, with SV 150 companies having substantially fewer executive officers. Companies in the SV 150 paid on average a fraction of the audit fees paid by companies in the S&P 100, at $4.8 million compared to $22.2 million.

Opinion: Elliott Has a Point When It Comes to EBay
" Bloomberg (01/22/19) Ovide, Shira; Halzack, Sarah"

Bloomberg contributors Shira Ovide and Sarah Halzack assert that Elliott Management Corp.'s call for changes at EBay Inc. (EBAY) highlights the company's missed opportunities. The hedge fund unveiled a more than 4% stake in eBay on Tuesday and presented a blueprint for changes that it said could double eBay's stock price. Elliott suggests eBay's ticket-selling business, StubHub, would be more valuable on its own, as would eBay's constellation of online classifieds websites in countries such as Germany and Australia. Ovide and Halzack say two points in Elliott's argument are difficult to refute: Marketplaces are the most promising corner of the e-commerce industry, and investors don't put much value on eBay's marketplace business. It has been tough for eBay in Inc.'s (AMZN) shadow, but there are areas for improvement in its marketplace operations. Compared with other internet middlemen including Walmart (WMT) and Amazon, eBay takes a relatively small cut of revenue from transactions on its marketplace, on average about 8% of the total value of purchases. Similar internet middlemen take on average 10% to 15% or more of the money from each transaction. StubHub's average cut is about 23%. Elliott notes that eBay has been plagued by technical problems, management missteps, and misplaced spending that have hurt marketplace sales growth and profits. And it says eBay missed opportunities to enter valuable corners of e-commerce that left openings for handmade-goods seller Etsy Inc. (ETSY), online furniture retailer Wayfair Inc. (W), and the online classifieds sites LetGo and OfferUp, among others. Like previous eBay critics such as Carl Icahn, Elliott is stressing persistent weak spots for the company. There are no easy answers for eBay, the authors conclude, but what Elliott gets right is that investors don’t believe in eBay’s direction for its marketplace business, which should be one of the havens of the internet.

Video: Full Interview With ValueAct Co-Founder Jeff Ubben
" CNBC (01/22/19)"

ValueAct Capital CEO and Chief Investment Officer Jeff Ubben sits down with CNBC's Sara Eisen to talk about the shift to shareholder primacy, corporate governance, sustainable businesses, and whether we're seeing a global slowdown.

Breakingviews—Busy Activists Navigate Tricky Currents
" Reuters (01/22/19) Larsen, Peter Thal"

Observers note that although activist investors are engaging bigger and more high-profile companies, they are becoming demanding and private equity may enter the fray. Research by Lazard reveals that activists engaged a record 226 companies last year, deploying $65 billion of capital, with nearly a quarter of all activist campaigns played out in Europe. Observers point out that activism's move into the investment mainstream is reflected in investors' willingness to take on multinationals that once would have been seen as untouchable, and this is due, in part, to big institutional investors becoming more active, often behind the scenes. "They are not cowards, but they don't want to be vocal, and they are giving a say or proxy to an activist on their behalf," said AccorHotels (ACCYY) CEO Sebastien Bazin. Broader shifts in the investing landscape also are playing a role. Companies and shareholders are under growing pressure to look beyond financial performance to such issues as the treatment of employees and customers, enforcement of environmental standards, and broader social responsibility. These objectives can conflict with short-term investment concerns, especially when activists are pressuring companies to cut costs or divest underperforming businesses. However, some funds hold their shares over the long term, and some activists indicate that their desire to improve the governance of listed companies aligns with that of ESG funds that filter prospective investments according to environmental, social, and governance criteria.

Elliott Has a Rocky Path to Telecom Italia Victory
" Bloomberg (01/21/19) Webb, Alex"

Italian regulators have rejected a spinoff of Telecom Italia (TI) favored by Vivendi and Vincent Bolloré, who controls the firm. According to Agcom, separating the landline network while retaining majority control would mean Telecom Italia would still have a "significant competitive advantage." Elliott Management, the second biggest shareholder pushing for the sale of a majority stake in the network, followed the announcement by declaring that Telecom Italia should separate the landline network without any further delay. Investors can justifiably be concerned that forgoing a bidding war in favor of a single prospective partner does not get them the best deal, writes Alex Webb. The Altice Europe deal shows there are buyers for such assets, but the Telecom Italia business is more complicated, is unlikely to secure such generous terms, and the government may not look so kindly on a different plan. Ultimately, the spinoff risks becoming a red herring due to board level fights that have hurt the day-to-day business. At the shareholder meeting in March, CEO Luigi Gubitosi will need to show that he can make Telecom Italia a success without control of the network. "That should be the metric investors focus on when deciding to back the Elliott board or to revert to control by Vivendi," according to Webb.

M&A Heats Up for Battered Mining Companies
" Wall Street Journal (01/18/19) Ramkumar, Amrith"

The mining industry is seeing a surge in engagement. Private-equity firm Waterton Global Resource Management is pushing Hudbay Minerals (HBM) to overhaul its board and replace its chief executive in a proxy fight with the Canadian base metals company. Hedge-fund manager John Paulson, who has been engaged in a six-month proxy fight with Detour Gold, overthrew part of the Canadian gold miner's board in December. Deals also are on the rise. The value of mining deals surpassed $10 billion in September for the first time in nearly four years, then topped that threshold again in November and then in January, according to Dealogic. Still, the industry continues to suffer from tepid metals prices, battles with emerging-market governments over reserves, and dwindling supplies. Mining's growth potential does not stack up relative to other industries, says Lucas Pipes, a mining analyst at B. Riley, but shares look cheap and there is a lot of opportunity. "For long-term investors, the sector may not have ever been more attractive than at this time," according to Pipes.

Top 10 Topics for Directors in 2019
" Harvard Law School Forum on Corporate Governance and Financial Regulation (01/17/19) Berchem, Kerry; LaFollette, Christine; Reddick, Frank"

Shareholder activism and Securities and Exchange Commission (SEC) regulation and enforcement will be among directors' top topics in 2019, according to Akin Gump Strauss Hauer & Feld. Last year, activism campaigns rose with regard to the number of companies engaged and the number of board seats won, and traditionally passive and institutional investors were more involved in encouraging company engagement with activists. The SEC took steps to enhance the board's role in evaluating whether to include shareholder proposals in a company's proxy statement, and solicited comments on the possible reform of proxy advisor regulation, so boards and companies should monitor developments in this area. Social issues were at the forefront this year, and likely foretell continued and increased focus on environmental, social, and governance issues, including from regulatory authorities. Boards should anticipate the possibility that allegations of sexual harassment may arise against a top executive. Public companies are facing increasing pressure from corporate governance groups, investors, and regulators to improve gender and other types of diversity on the board. Corporate strategic planning should continue to be a high priority, along with thoughtful efforts to understand company culture. U.S. sanctions, cybersecurity, and the Tax Cuts and Jobs Act also will be issues of concern for directors this year.

Video: Activism in Europe: Combative or Constructive?
" Reuters Breakingviews (01/18/19)"

Activist shareholders are preparing to storm European boardrooms in 2019, according to Reuters Breakingviews. The London Predictions event will discuss what investors want and how companies should respond to them. Panelists include Anne-Sophie d'Andlau, co-founder of CIAM; Rich Thomas, a managing director in Lazard's Shareholder Advisory Group; Leslie McGibbon, who led global communications for AkzoNobel during a high-stakes corporate battle; and Liad Meidar, a managing partner and chief investment officer at Gatemore Capital Management.

Video: How Bad Corporate Governance Is Hurting South Africa
" CNBC Africa (01/18/19)"

Corporate governance in South Africa has been a contentious issue of late, with companies airing their dirty laundry as shareholders speak out against what is seen as maladministration or lack of accountability. Shareholder activist Theo Botha speaks with CNBC Africa.

Hedge Fund Can Give Olympus a Clearer Focus
" Bloomberg (01/16/19) Gopalan, Nisha"

Olympus is shaking up its leadership and board in response to pressure from hedge fund ValueAct Capital Management. Hiroyuki Sasa, appointed chief executive officer a year after the fallout from the company's accounting scandal in 2011, will be replaced by chief financial officer Yasuo Takeuchi. The Japanese camera and medical-device maker also will appoint three foreign board members, including ValueAct partner D. Robert Hale. Although Olympus shares recovered under Sasa's tenure, the company failed to stay free of controversy. But the latest announcement, which includes plans to cut costs and reshape the medical business, have sent the company's shares to their highest level in three years. Investment banks are optimistic, writes columnist Nisha Gopalan. Sasa did not renew a poison pill arrangement, and the board's composition has changed; it is now 55% independent and the average tenure has been halved to three years. "By bringing in ValueAct's Hale and promising to add two more international executives with medical experience (a rare Japanese concession to an ... investor), Olympus is signaling a willingness to further improve its corporate governance," concludes Gopalan.

Out With the Old, in With the New in the Consumer Goods Sector
" Financial Times (01/16/19) Abboud, Leila; Walker, Owen; Fontanella-Khan, James"

Increased pressure from investors and evolving shopping habits in the smartphone era have resulted in a changing of the guard at the world's leading consumer goods companies. In the last six months, CEOs have departed at Unilever (UN), PepsiCo (PEP), British American Tobacco (BTI), and Beiersdorf (BDRFY). These departures followed earlier shake-ups at Nestlé (NSRGY), Mondelez International (MDLZ), and Campbell Soup (CPB). This week, Reckitt Benckiser (RBGLY) CEO Rakesh Kapoor and JAB Holdings Chairman Bart Becht both announced their resignations. "One can't help but feel that an era is ending," said Jefferies consumer analyst Martin Deboo. "The next generation of managers will need to be digital savvy in [a] way the current ones perhaps could not be." Much of the industry has imposed significant cost cuts, often under pressure from such investors as Dan Loeb's Third Point—which secured two board seats at Campbell; and Paul Singer's Elliott Management—which recently launched a campaign against Pernod Ricard (PDRDY). Observers note that even the threat of an activist investor can be enough to spur action, which could be behind Kapoor's departure. Buchanan Harvey's Samuel Johar says, "There has been dissatisfaction among shareholders with Rakesh for a while and the board has moved to address it. If they had allowed it to fester then they might well have faced an activist challenge and they would have lost control of the agenda."

2019 Proxy Letter—Aligning Corporate Culture With Long-Term Strategy
" Harvard Law School Forum on Corporate Governance and Financial Regulation (01/15/19) Taraporevala, Cyrus"

State Street Global Advisors (SSGA) plans to focus on corporate culture as a priority engagement topic in 2019. Intangible assets such as corporate culture are driving a greater share of corporate value as the challenges of change and innovation grow more acute. Through engagement, however, SSGA has found that few directors can adequately articulate their company's culture or demonstrate how they assess, monitor, and influence change when necessary, writes Cyrus Taraporevala, SSGA's president and CEO. SSGA has created a framework for companies to evaluate the alignment of corporate culture with their long-term strategy and for directors to guide senior management in its implementation. The Framework for Assessing and Monitoring Corporate Culture is based on insights gathered from years of engagement, and will help companies address the issue by conducting an analysis to determine whether culture and strategy are aligned, implementing mechanisms to influence and assess progress, and improving reporting that can help directors discuss their role in influencing and monitoring corporate culture. SSGA also provides examples of some best practices related to culture that it has identified through engagement. The investment manager is calling on boards to proactively review and monitor corporate culture, evaluate alignment with strategy, and incentivize management to take corrective action, if necessary. SSGA hopes "that prioritizing corporate culture in our stewardship program and providing transparency into our approach to engagement on this topic will lead to meaningful conversation about an intangible, yet critical component to the long-term success of a company," concludes Taraporevala.

Olympus Shares Should Come Down From the Mountain
" Wall Street Journal (01/16/19) Wong, Jacky"

Foreign investors have scored a rare win in Japan. Olympus has appointed a new management team and says it will reform its corporate structure. Moreover, Olympus will appoint three outside directors, including one from San Francisco-based hedge fund ValueAct, which owns a 5% stake in the medical-device maker. The company was hit by an accounting scandal in 2011 involving more than $1 billion of hidden losses, and was fined $85 million in December for failing to file reports with U.S. regulators about infections linked to its medical devices. Foreign investors own around half of Olympus, and might have sided with ValueAct due to the company's recent troubles. Foreign investors have become more prominent in Japan as the government pushes for corporate-governance reform. A record number of Japanese listed companies received proposals from shareholders during annual general meetings last year, according to Goldman Sachs. More investors are voting against resolutions that are not aligned with their interests.

Video: Investors Are Getting a 'Win-Win' Trade in This Dollar Tree Battle
" CNBC (01/15/19)"

Jim Cramer says Starboard Value's involvement in Dollar Tree (DLTR) is bringing some trading opportunities into focus.

Shutdown Ties Companies’ Hands on Unwanted Shareholder Proposals
" Wall Street Journal (01/15/19) Rubin, Gabriel T."

Publicly traded companies could have to put shareholder proposals to a vote if the government shutdown does not end soon. That is because the Securities and Exchange Commission (SEC), which is operating with minimal staff, must approve requests by companies to exclude proposals from a vote at annual shareholder meetings. The SEC each winter handles a flood of requests from corporations to keep unwanted initiatives off the proxy ballots that every public company is required to put before its stockholders. “Companies are stuck in limbo right now,” said Tom Quaadman, executive vice president at the U.S. Chamber of Commerce, a trade group. “They are going to become more vocal if the shutdown continues.” Proposals are frequently excluded from ballots by the SEC, such as if they have been voted on before by a company's shareholders or if they are deemed to not be economically relevant to a company's performance. Companies are supposed to file requests to the SEC for exemptions at least 80 days before they send out proxy materials to shareholders, to give commission staff sufficient time to consider the applications. The SEC typically responds within 30-45 days, though more complex issues can take nearly the entire 80 days. Companies with meetings in March and April still have time to exclude proposals, provided the government shutdown ends in the near future, and have some recourse to prevent votes on proposals even if it continues.

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