Huntsman sees off ‘activist’
Huntsman shareholders have voted to elect all ten of its director nominees to the board at their AGM, giving the management an important victory over ‘activist’ shareholder Starboard, which had been trying to steer the firm in a different direction. It can now continue to follow the strategy outlined at an Investor Day in November 2021, subject to final results.
“Over the past few years, we transformed our product portfolio to focus on 'value over volume' and fully deleveraged our balance sheet, earning an investment grade rating,” said Peter R. Huntsman, chairman, president and CEO. “The outcome of today’s shareholder vote is validation of our portfolio strategy and recognition that the Huntsman of today is vastly different than the Huntsman of five years ago.”
Ahead of the meeting, Huntsman had written to all of its shareholders to ask for their backing. “Don’t let Starboard and its short-term focus put your investment in Huntsman at risk,” the company said. It cited recent milestones, including:
* Record results in Q3, Q4 and full-year 2021, increased guidance in Q1 2022 and analysts' consensus at record levels
* A stock price trading near its all-time high with our shareholders enjoying a substantial share price increase since November 2021, beating the firm’s next best peer, Eastman Chemical, by double digits
* One-, three- and five-year TSR of 36%, 76% and 91% respectively, exceeding both peers and the S&P 500 by a wide margin
* An increased dividend by 70% since 2018, with a recent increase of 13% in February 2022
* A new share repurchase plan of $1 billion to be completed within two years
* A $665 million award and settlement against Albemarle based on the conduct of four senior executives who committed fraud against Huntsman, two of whom are still serving Starboard-controlled GCP Applied Technologies.
Independent proxy advisory firm Glass Lewis commented: “Huntsman's recent financial and stock price performance indicate the Company is on the right track and, ultimately, we fail to see a compelling case that further changes beyond those the board has already made are either warranted at this time or likely to result in incremental improvement.”