An annual meeting for the ages

 Disgruntled shareholders are a popular feature at most big companies’ annual meetings, but two really huge battles between shareholders, board members and other interested people featured female CEOs to add to the drama.

On March 19, 2002, Hewlett-Packard CEO Carly Fiorina declared victory in a battle to

                      Ellen Kullman, CEO, Du Pont

merge with Compaq, to make the combined company almost as big as IBM. Reams of newsprint was consumed analyzing the maneuvering between Fiorina and some of her board members and opponents of the move, which included Walter Hewlett and the Packard Foundation.

Opponents challenged the results and it took a court decision in Nov. 2004 to validate Fiorina’s early declaration. This is now a case study in business ethics.

There is bitterness to this day and debate about whether it was a wise more. IFO has suspicions of less-than ethical activities on the part of supporters of the merger. Absolutely NO proof or evidence whatsoever. Just a hunch. Of course, IFO was among the opponents, too. She didn’t own any shares, but has a tendency to take sides in hard-fought, high-stakes battles anyway.

Have you guessed what the current company is that had a proxy battle just a few weeks ago? It is sure to join the case study world in business administration education.

E. I. du Pont de Nemours and Company, or Du Pont (NYSE:DD), for short, is the battling company. It was founded in 1802 – a 213 year-old company!  Also headed by a female CEO, Ellen Kullman. She won the battle this year, May 13, 2015, and got a standing ovation from shareholders, employees and her board at the annual meeting when the vote was taken and it was clear she had won.

Showing that sexism still rules, even in the august halls of the Wall Street Journal, here is a headline trumpeting the vote: “DuPont Defeats Peltz, Trian in Board Fight.” Du Pont? Du Pont??? At least a photo of Kullman was featured to head the story.

Peltz was the ‘activist” investor who wanted to take control of the company and sell off parts of it. Ms. Kullman fought his attack and fought hard. And won. The vote wasn’t even close, compared to the HPQ vote.

Again tons of copy will be filed analyzing this case. It’s highly entertaining reading. IFO always likes to read about victories that seem to have been won for the right reasons. Also again, IFO doesn’t own any shares of DD, but she is currently doing her due diligence phase as she considers buying some. [First nervous-making fact: Kullman was an honored guest at some function(s) of the Clinton Family Foundation.]

It’s amazing, but this level of excitement during battles for control extends to the smallest companies at times. We’ve had a few right here in Yamhill County, but they weren’t public companies, so the fights are harder to follow except by participants.

Wasn’t that fun? Tomorrow, we’ll return to our regular posting unless another exciting event pops up.


About InvestingforOne

I've been investing in various assets by myself using a discount broker for many years. Over that time, I've developed some theories that others might find useful. Plus, there is more to investing than money. Time, talent, work, friends, family all go into developing a good and satisfactory strategy.
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