The ongoing battle between the board of US food group HJ Heinz Company and Trian, the shareholder group bidding to place five nominees on the Heinz board, continued yesterday (3 August), as both parties claimed support for their respective positions in the build-up to the company’s AGM this month.

The Trian Group said yesterday that the independent proxy voting advisory service Institutional Shareholder Services (ISS) had recommended that Heinz shareholders elect three of the five Trian nominees, Nelson Peltz, Greg Norman and Michael Weinstein, to the board.

However, the board itself also received a welcome fillip in the form of the support of the fund manager CtW Investment Group.

ISS said that the presence of the three nominees “would likely prove beneficial to long-term shareholder value”. ISS continued: “The long-term financial and operational performance of the company and the dissidents’ skill sets and track record establish both the need for change and the dissidents’ ability to effect change.”

ISS said that it had consulted with industry analysts and long-term shareholders, and found that Heinz had “a history of over-promising and under-delivering”. There was evidence of fatigue among shareholders from year after year of meetings in which management promised things would be better soon, ISS said.

Trian said it was very pleased that ISS had recommended the election of three of the nominees but added that it still believed it needed all five nominees to be elected.

In a statement, Trian said: “As the second largest holder of Heinz stock with an approximate US$750m investment, we remain concerned that the Heinz board’s recently announced financial initiatives will be unsuccessful, just like its previous five failed restructuring plans, unless all five of our highly qualified and independent director nominees, with their significant operating, marketing and capital markets experience and fresh perspectives, are added to the Heinz board to hold management accountable for its performance.”

Fund manager CtW Investment Group announced yesterday that is was recommending to shareholders that they re-elect the 12 existing Heinz directors. Heinz issued a statement welcoming the endorsement.

CtW said: “The Heinz nominees have made a compelling case for shareholder support predicated on a detailed, credible business plan that does not alter the company’s risk profile and a commitment to add two independent directors with packaged food industry experience and unimpeachable leadership credentials.”

While CtW said Heinz would benefit from having additional independent directors, it rejected the Trian nominations. “They have neither put forward a credible business plan to create long-term value nor demonstrated a commitment to corporate governance practices that will protect the interests of all shareholders. In short, while we believe the Heinz board would benefit from additional independent directors, the Trian nominees are the wrong choice,” CtW said.