The LuLac Edition #3942, November 27th, 2018

CAMPBELL'S SOUP PROXY FIGHT OVER

If you thought huge mailers during the political season from Eddie Day Pashinski, Matt Cartwright and John Chrin were constant and you though never ending, you should be a stock holder in the Campbell Soup company!
When I worked representing the company from 2012 through 2017 I became a stockholder. It wasn’t a lot of shares but I bought it for a decent price and pretty much never thought about it again.
Until……..this year when Denise Morrison, the CEO retired suddenly. Then there was a fight for control of the company. What ensued was a battle between the majority stock holders and a hedge fund that wanted representation on the board.
The battle was over sagging soup sales of the iconic Campbell’s red and white soups as well as acquisitions the company made to bolster its portfolio. Campbell’s paid billions for Bolthouse drinks as well as Lance crackers.
Well during the last few months I have been receiving mail from Third Point representing the fund and Campbell’s. The white card was to vote for change, the yellow card was to stay with Campbell’s. Or vice versa.
But the point is moot because an agreement came yesterday. A compromise if you will.
So I’m spared the agony of having to vote but will keep a watchful eye on what’s in the soup to see how this new plan is doing.
To put this in perspective, Campbell’s is an established nearly 150 year old heritage company worth billions. But Kraft refused an overture to buy them because “Campbell’s was just too damn small for them!”

The vicious fight for control of Campbell Soup is over.

For months, activist investor Daniel Loeb's hedge fund Third Point has been attempting to overhaul the soup company's board and install its own directors.
On Monday, both sides agreed to end the proxy fight and expand the Campbell board from 12 to 14 members. Two of the five nominees suggested by Third Point will be added to the board. Both sides said they were satisfied with the outcome.
"We are pleased to have reached an agreement with Third Point that is in the best interests of Campbell shareholders," Keith McLoughlin, the company's interim president and CEO, said in a statement.
added that "Third Point looks forward to working collaboratively with Campbell to improve value for all shareholders."
Former Gerber CEO Kurt Schmidt and Comscore president Sarah Hofstetter will join the current leadership team after the company's annual shareholder meeting Thursday.
The hedge fund is withdrawing its bid for the other three nominees as well as its lawsuit against Campbell (CPB). As part of the agreement, Third Point will get a say in selecting the new CEO and another member of the board.
Campbell makes its case to quash a takeover plot, but still can't sell enough soup
Campbell has said a new chief executive will be announced by the end of this year. The additional director will be added by May of next year.
"This is a face-saving end result for both sides," said Kai Liekefett, a partner at the law firm Sidley Austin who leads Sidley's shareholder activism practice.
The agreement marks the end of a long battle.
Third Point recommended replacing the entire board in September, after Campbell said it wasn't planning to sell the company.
Loeb penned a scathing letter to the chairman of the company's board at the time, blaming leadership for the company's problems and accusing members of "mismanagement, waste, ill-conceived strategy, and inept execution." Campbell maintained that it knows what's best for the soup company.
Things heated up after that: Third Point sued the company and accused Campbell of making boring, expensive soup; Campbell said that Third Point's ideas were unoriginal and uninformed.
Despite it's aggressive attitude, Third Point was always fighting an uphill battle.
About 41% of Campbell is controlled by descendants of the founding family, who vowed to support the current leaders. Third Point and its supporters hold only about 10%.
Bid to shake up Campbell Soup gets a boost
Over time, Third Point softened its stance. Earlier this month, the hedge fund said it wanted to replace five instead of all 12 members. Campbell said prior to Monday's agreement that Hofstetter and Schmidt would be a good fit.
The hedge fund hopes to help put the company back on track, and as part of the agreement will get the chance to share ideas with Campbell's leadership.
Campbell conducted a full operational review last summer in the wake of poor sales and the abrupt departure of its former CEO. At its conclusion, the company decided to sell its fresh and international businesses and focus on snacks, meals and beverages.
The plan is working so far, McLoughlin said on a recent earnings call. But the company is still having a hard time selling soup: US soup sales are falling, and the company expects that trend to continue next year.
Shares of the company fell about 4% midday Monday. (LuLac, CNN Business) 
EDITOR'S NOTE: I am a shareholder in Campbell's stock.