Blackwells Capital Pushes Supervalu to Oust Board of Directors
MINNEAPOLIS, MN - Since insisting on more control of SuperValu’s Board back in February, Blackwells Capital, one of SuperValu’s largest shareholders, has been biding its time, waiting for the perfect time to strike a new deal with the retailer. The time came last week when Blackwells issued a letter to SuperValu that called (again) for the replacement of six members on its nine-member Board of Directors and threatened a full-on revolt at the next shareholder meeting if ignored again, according to a recent press release.
“We believe there is significant value in Supervalu’s assets, people, and business relationships. But, after years of continuous value destruction, as a result of what in our view has been a misguided and haphazard strategy overseen by this Board, we are compelled to drive change that unlocks value for the benefit of all Supervalu’s shareholders,” Blackwells Capital writes. “The company has reacted to our suggestions with what we believe are ineffective half measures. With the share price still trading near six-year lows after the recent fourth quarter earnings, it is more evident than ever that the markets have lost all confidence in Supervalu’s current strategy, and in a Board that does not lead, but simply reacts.”
In its letter, the investor, which owns a 5.2 percent stake in the company, expresses frustration with the lack of acknowledgement and action of its previous request. Specifically, Blackwells points out in its letter that it had nominated “six exceptionally talented, independent candidates, who each bring desperately needed experience in retail and wholesale grocery, logistics, sustainability, and corporate turnaround, as well as fresh perspectives,” but instead of reviewing their credentials, SuperValu “publicized [Blackwells’] nomination notice,” “mischaracterizing” its intentions and rights as a shareholder, according to Blackwells.
As a solution, Blackwells suggests, SuperValu “engage with [its] shareholders. Enter into constructive discussions about ways to strengthen this Board. Take the time to meet with each of [its] extraordinary board nominees. Fulfill [its] fundamental duties by scheduling an annual meeting.” If unheeded, or if “procrastination, delay tactics, and defensive half measures” continue, Blackwells will “provide every SuperValu shareholder with the last say at the upcoming annual meeting. There [SuperValu] will have what we believe is a clear choice: between the status quo, with an entrenched Board that has proven itself unable to set a winning strategy, or a slate of highly qualified independent board candidates who are prepared and committed to unlock value for all shareholders.”
Will Blackwells' airing of SuperValu's dirty laundry lead to action on the retailer's part? AndNowUKnow will continue to report on the latest industry tea.