January 7, 2019 / 4:27 PM / 12 days ago

Cruiser Capital targets Ashland directors, including chairman

BOSTON (Reuters) - Cruiser Capital Advisors said on Monday it wants to replace four directors at chemical company Ashland Global Holdings, including the board chairman.

The New York-based hedge fund aims to remove Ashland Chief Executive Bill Wulfsohn from his position as board chair and is also targeting three other directors who are members of the company’s governance and nominating committee.

“Should Bill Wulfsohn hold both the Chairman and CEO jobs?,” the hedge fund wrote in a letter on Monday. It said Wulfsohn has been paid $43 million over four years even as the company has missed operational targets and its stock price has faltered.

Ashland urged shareholders to ignore the hedge fund and vote for its slate at its Feb. annual meeting, arguing that it listens to investors’ suggestions on board members and adds them when appropriate.

A growing number of investors, including hedge funds, are flexing their muscle by pushing to remove board members. But targeting a board chairman is still a relatively unusual move, industry analysts said.

Cruiser, which owns a 2.5 percent stake in Covington, Kentucky-based Ashland, has been pushing management for months to improve its margins. It said again on Monday that it thinks the company could be worth more than $125 a share if improvements are made.

The stock price opened at $72.31 on Monday and has fallen 12.72 percent in the last three months.

The two sides have also sparred over board members for some time.

Cruiser is urging investors to elect Bill Joyce, Allen Spizzo, Carol Eicher and Pat Gottschalk to the board.

Ashland asked shareholders to re-elect all directors, including Wulfsohn, and called 2018 “a year of great progress for Ashland’s value creation plan.” It said it is adding Craig Rogerson, chairman, president and chief executive officer of Hexion, to its slate.

Reporting by Svea Herbst-Bayliss; Editing by Dan Grebler

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