Two years after then-Newell Rubbermaid acquired Jarden Corp., three former Jarden executives are reportedly teaming with an activist hedge fund to replace Newell Brands’ CEO Michael Polk and its board of directors, the Wall St. Journal reported on Friday, February 9.
According to the Journal, former Jarden chairman Martin Franklin, former Jarden CEO Jim Lillie and another former Jarden executive, Ian Ashken, are involved in the effort along with hedge fund Starboard Value LP. Published reports indicated that Starboard and its associates own less than 5% of Newell Brands.
Newell Brands issued a press release on Friday confirming that the company has received notice from Starboard Value and Opportunity Master Fund Ltd. of its intention to nominate 10 candidates to stand for election to Newell’s Brands’ board of directors at the company’s 2018 annual shareholders meeting.
Published reports said that Starboard is looking to make Lille Newell CEO and Franklin chairman of the board.
In a filing with the Securities and Exchange Commission on January 25, the company reported that Ian Ashken, Domenico De Sole and Martin Franklin resigned from the board as of January 21. In connection with the resignations, the board has reduced its size to nine members.
Just days after the aforementioned resignations, Newell officials said the company was exploring strategic options for several of its divisions that include Rubbermaid outdoor, closet and refuse and several other commercial product categories.
Company officials said executing these strategic options would result in a 50% reduction in its customer base and a 50% reduction in the company’s global factory and warehouse footprint. The end result would be a company with approximately $11 billion in net sales and $2 billion in EBITDA.
Michael Polk, Newell’s CEO, called the move a “significant acceleration” in the company’s transformation plan.
“We believe that exiting non-strategic assets, reducing complexity and focusing on our key consumer-focused brands will make us more effective at unlocking value and responding to the fast-changing retail environment,” he said.