Hestia Capital Highlights Recent Support from Two Leading Independent Proxy Advisory Firms
01 Maio 2023 - 10:40AM
Business Wire
ISS and Glass Lewis Endorsed Hestia’s Case
for Meaningful Boardroom Change at Pitney Bowes and Underscored the
Need to Reduce Interlocks That Insulate the Management from
Accountability Following Prolonged Value Destruction
Hestia Capital Management, LLC (collectively with its
affiliates, “Hestia” or “we”), which is the third largest
stockholder of Pitney Bowes, Inc. (NYSE: PBI) (“Pitney Bowes” or
the “Company”), today commented on Institutional Shareholder
Services Inc. (“ISS”) and Glass, Lewis & Co.’s (“Glass Lewis”)
recommendations that Pitney Bowes’ stockholders support meaningful
boardroom change at the Company’s 2023 Annual Meeting of
Stockholders (the “Annual Meeting”). As a reminder, Hestia has
nominated five highly qualified and independent director
candidates: Milena Alberti-Perez, Todd Everett, Katie May, Lance
Rosenzweig and Kurt Wolf to Pitney Bowes’ nine-member Board of
Directors (the “Board”).
Kurt Wolf, the Founder and Chief Investment Officer of Hestia,
commented:
“We appreciate that ISS and Glass Lewis have endorsed our case
for meaningful boardroom change and recommended stockholders vote
for Hestia-nominated director candidates. Our five-member slate is
incredibly excited about the opportunity to fix Pitney Bowes’
addressable issues and implement a plan to spur a value-enhancing
turnaround for stockholders, employees, partners and customers. It
has been a long decade of broken promises, large losses and limited
accountability for a Chief Executive Officer who has filled the
boardroom with allies and received more than $66 million in
compensation for sustained failure. Fortunately, the Company’s core
segments — SendTech and Presort — are exceptional businesses that
can power a lasting turnaround once they are prioritized and no
longer neglected at the expense of the perpetually mismanaged
Global Ecommerce segment. Our slate believes Pitney Bowes will
become a much more sustainable business once the Global Ecommerce
segment stops hindering the Company’s credit profile, earnings and
free cash flow. As S&P Global Ratings recently put it, “[t]he
path to sustainable growth and EBITDA generation from the GEC
segment—critical in our view to the long-term health of Pitney
Bowes—remains muddled and once again delayed.”
Following the Annual Meeting, if elected, our slate intends to
put this contest behind us and start working closely with the
remaining directors to ensure a seamless transition and facilitate
a pivot in strategy. Our slate has identified significant room for
improvement based on the Company’s eight-year-old strategy driving
negative total stockholder returns of roughly 80% and numerous
credit downgrades. Our slate will benefit from certain incumbent
directors’ knowledge, just as we believe they will benefit from
having new perspectives and no interlocks in the boardroom. We look
forward to continuing to engage with fellow stockholders to achieve
our goal of helping Pitney Bowes enhance its corporate governance,
improve its capital structure and credit profile, and optimize the
Company’s core segments and Global Ecommerce unit.
As a reminder, ISS recommended stockholders vote for four Hestia
nominees: Milena Alberti-Perez, Todd Everett, Katie May and Kurt
Wolf. It noted the following in its report:1
- “In summary, shareholders have endured a decade of
underperformance and disappointment, there are unanswered questions
and serious concerns about the path forward, and power on the
board is concentrated in the hands of those directors who
objectively have the most potential for a conflict of interest
by virtue of their past experience and tenure.”
- “[…] ISS has received volumes of unsolicited inbound
statements of support for the dissident. This suggests that
there is an elevated likelihood that all five dissident nominees
will be elected. If this occurs, there is no specific reason to
believe that Lance Rosenzweig cannot be effective as a director and
interim CEO.”
- “Moreover, there is certainly a sense of urgency after ten
years of decline, but PBI does have adequate time to weigh its
options […] if the reconstituted board, after close
examination of the available alternatives, concludes that
management change is necessary.”
Glass Lewis recommended stockholders vote for Hestia nominees
Katie May, Lance Rosenzweig and Kurt Wolf, noting in its
report:2
- “Given our governance concerns and the Company's dismal TSR and
operational performance, we see an ongoing, urgent need for
additional changes to Pitney's board composition. In our
opinion, such change is warranted and necessary to ensure
there are truly independent and objective voices in the boardroom
that will hold management accountable, if necessary, while
injecting new perspectives and ideas to sharpen Pitney's
strategic focus and operational execution.”
- “In our view, the consistency and extent to which Pitney's
shareholder returns have been negative and underperformed relevant
benchmarks indicate that changes may be warranted to the
Company's strategy, board composition and, potentially,
management. We believe this view is reinforced by the board's
seeming unwillingness to accept any blame for these results, other
than acknowledging that forecasted improvements have taken longer
than expected. Instead, the board is determined to stay the
course in the face of consistently poor performance rather than
making potential adjustments to strategy or execution that could
drive better outcomes for shareholders.”
- “[…] we believe [Mr. Rosenzweig’s] experience and
perspective will help to ensure a focus on cost controls and
operational discipline remain paramount in the boardroom, given
the potential opportunity to significantly reduce SG&A expenses
and achieve other operational efficiencies […] we believe Mr.
Wolf's owner's mentality, capital allocation expertise, willingness
to challenge management and other directors, when necessary,
and prior public company board experience will have a
meaningfully positive impact in the Pitney boardroom to the
benefit of all Pitney shareholders and investors.”
Hestia’s five-member slate includes experienced c-level leaders
who are committed to working with the remaining directors and
possess the right skillsets to address Pitney Bowes’ most critical
areas:
Milena
Alberti-Perez
Todd
Everett
Katie
May
Lance
Rosenzweig
Kurt
Wolf
- Chief Financial Officer experience
- Former Newgistics Chief Executive Officer
- Former ShippingEasy Chief Executive Officer
- Proven turnaround Chief Executive Officer
- Top three Pitney Bowes stockholder
- Public company board service
- Mailing, shipping and logistics expertise
- Public company board service
- Public company board service
- Record of working well with refreshed boards
- Audit, M&A and capital allocation expertise
- Mailing, shipping and logistics expertise
- Cost management expertise
- Strategic planning and capital allocation expertise
- Endorsed by ISS and Glass Lewis
- Endorsed by ISS and Glass Lewis
***
As a reminder, Hestia is seeking to elect
five highly qualified and independent candidates to Pitney Bowes’
nine-member Board at the Company’s Annual Meeting on May 9,
2023.
To maximize the likelihood of a turnaround
at Pitney Bowes, we urge you to vote for Hestia’s full slate on the
WHITE universal proxy card or
WHITE voting instruction form.
Visit www.TransformPBI.com to download a
copy of our investor presentation, receive future updates and
obtain information on how to vote for Hestia’s full slate.
***
About Hestia Capital
Hestia Capital is a long-term focused, deep value investment
firm that typically makes investments in a narrow selection of
companies facing company-specific, and/or industry, disruptions.
Hestia seeks to leverage its General Partner’s expertise in
competitive strategy, operations and capital markets to identify
attractive situations within this universe of disrupted companies.
These companies are often misunderstood by the general investing
community or suffer from mismanagement, which we reasonably expect
to be corrected, and provide the ‘price dislocations’ which allows
Hestia to identify, and invest in, highly attractive risk/reward
investment opportunities.
_______________________ 1 Permission to quote ISS was neither
sought nor obtained. Emphases added. 2 Permission to quote Glass
Lewis was neither sought nor obtained. Emphases added.
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Longacre Square Partners Charlotte Kiaie / Miller Winston,
646-386-0091 hestia@longacresquare.com
Saratoga Proxy Consulting LLC John Ferguson / Joe Mills,
212-257-1311 info@saratogaproxy.com
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