The board of US food group HJ Heinz Company has sent a further letter to shareholders in advance of its August AGM, urging them not to elect nominees put forward by the Trian Group and restating its intention to add two new independent directors to the board.
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The letter states that in the company’s view adding any of the nominees of the Trian group to the board “would create gridlock on the Heinz board, weaken shareholder democracy and impede decision-making”.
The company further stated that any of the nominees “would represent Trian’s own interests exclusively, and over time facilitate the Trian Group’s taking control of the HJ Heinz Company without paying you a premium”.
The letter, which was co-signed by Heinz chairman, president and CEO William R. Johnson, and presiding director Thomas J Usher, urges shareholders to re-elect the company’s 12 directors, stating that the company is building business momentum due to the successful execution of its current business plan, strong share price momentum and a strong, independent and highly-qualified board that will hold management and itself accountable to the best interests of all shareholders.
However, Heinz also states in the letter that it plans to add two new independent directors to the board to “further enhance corporate governance and the skills of the board”.
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By GlobalDataTrian’s five nominees include shareholder Nelson Peltz, his son-in-law, his close friend, his longtime business partner and one of his former employees, the letter states. Heinz also points out that while “Mr Peltz and Trian have spent a lot of time criticising Heinz’s historical performance, they have not articulated a cohesive or achievable vision with operational specifics”.
In the letter, Heinz also takes the opportunity to reiterate its projection of better-than-anticipated first-quarter results that put the company “comfortably on track to deliver earnings per share of US$2.35 in fiscal year 2007 – an increase of 10% over fiscal year 2006”.
Heinz’s Annual Meeting of Shareholders takes place on 16 August, 2006, at the Hilton Pittsburgh.
