The board of Campbell Soup Co. has urged investors to vote against Third Point in the latest skirmish of the proxy battle between the soup company and the activist hedge fund.
In a public letter sent to shareholders on Thursday, independent chairman Les Vinney advocated in favor of the existing board, arguing that the Third Point nominees were “underqualified” and only interested in pursuing an “immediate” sale of Campbell.
Third Point, a multistrategy hedge fund founded by Daniel Loeb, had launched a campaign to overturn Campbell’s entire board after disclosing a 5.65 percent stake in the company in August. The hedge fund has since upped its stake to about 7 percent, according to a regulatory filing made October 9.
Its proposed 12-person board slate includes Matthew Cohen, a managing director and head of consumer investments at Third Point, as well as Munib Islam, a partner at Third Point who leads the firm’s efforts in global equity research and investing.
“Third Point’s director candidates are nothing more than hand-picked agents selected to execute Dan Loeb’s self-serving scheme to deprive you of the opportunity to benefit from the company’s plans to maximize shareholder value,” Vinney said in his letter shareholders.
The independent chairman further argued that Third Point had “a superficial understanding” of Campbell and the food industry “at best,” adding that the hedge fund “has not provided any new ideas to enhance shareholder value.”
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According to Campbell, four of its largest shareholders – all descendants of John Dorrance, the inventor of Campbell’s condensed soup – have already pledged to support the existing board. These shareholders, which include directors Bennett Dorrance, Mary Alice Dorrance Malone, and Archbold van Beuren, represent about 41 percent of outstanding shares.
In backing Campbell’s existing board – which includes himself – Vinney said the current directors have “the right mix of financial, operational, and strategic expertise,” and are “unified and committed to maximizing value for all Campbell shareholders.”
Third Point, meanwhile, has disparaged the board’s “failed leadership,” releasing a YouTube video last week that described Campbell’s Soup as “mmm, mmm, bad.”
The video went on to claim that the board had “destroyed over two decades of value for its shareholders,” citing the soup maker’s floundering share price. The stock was trading around $38 Thursday afternoon, down about 21 percent this year.