Tag Archives: Ralph Whitworth

What's Wrong With HP Today?

By Anders Bylund, The Motley Fool

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Hewlett-Packard just took a much-needed step toward a healthier business: Chairman Ray Lane and two other directors stepped down from the board of directors. Lane will remain a director but without the chairman’s leadership duties. Banking veteran G. Kennedy Thompson will leave the board entirely in May, alongside John Hammergren, who is also CEO of health care information company McKesson. Activist investor Ralph Whitworth serves as chairman until further notice. No replacements have been named for the two outright departures.

Investors have been calling for something like this to happen. Each of these three directors earned less than 60% approval ratings in HP‘s recent annual shareholder meeting, while every other director won more than 90% “yea” votes. This is the kind of “vote of no confidence” that drove Michael Eisner out of Walt Disney nearly 10 years ago. When you’re running for office unopposed, you really should expect far higher approval ratings. Lane and company are simply following the will of their shareholders.

Moreover, HP‘s board has long been seen as a liability. Corporate-ethics expert Nell Minow quipped that these people might as well carry a banner saying, “We have no idea what we’re doing.” That was two years and two CEOs ago — not to mention the whole Autonomy debacle. A wholesale housecleaning is very much in order.

And yet HP shares are down 1.6% on the news. It’s the third-worst performer on an already weak Dow Jones Industrial Average today. Financial giant American Express plunged 2.3% on weak payroll data, which will put direct pressure on the company’s top line. Cisco Systems fell 2.2% due to terrible earnings at rival F5 Networks; the entire networking sector is suffering today, and not even mighty Cisco is immune to sectorwide swings.

There are plenty of other losers on the Dow today, but only these two fared worse than HP.

Why, then, is HP plunging on what looks like good news for the long-term health of the company? Well, change is always scary. The action may have underscored HP‘s shaky situation to some investors. Maybe the changes didn’t go far enough; Lane is still on board, and his companions will stay around for another month.

The real reason is probably “all of the above.” That disgraceful shareholder vote set the stage for today’s action, but it still comes as a shock to the system.

Will CEO Meg Whitman pair up with interim chairman Whitworth and really shake HP up? I hope so. This is their chance to catch up with a rapidly changing market. The current strategy sure isn’t working.

The massive wave of mobile computing has done much to unseat the major players in the PC market, including venerable technology names like Hewlett-Packard. However, HP is rapidly shifting its strategy under Whitman’s leadership. Does this make HP one of the least-appreciated turnaround stories on the market, or is this a minor …read more

Source: FULL ARTICLE at DailyFinance

Ray Lane Cedes Hewlett-Packard Chairmanship, Will Stay On Board

By Steve Schaefer, Forbes Staff

Hewlett-Packard announced a new look for its board of directors after the closing bell Thursday. Chairman Ray Lane will give up that role, but remain on the board, while fellow directors Ken Thompson and John Hammergren will depart. Ralph Whitworth will assume Lane’s chairmanship on an interim basis until a permanent replacement is found. …read more

Source: FULL ARTICLE at Forbes Latest

Hewlett-Packard Chairman to Relinquish Post

By Eric Volkman, The Motley Fool

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Hewlett-Packard has begun the search for a new board chairman following Raymond Lane‘s decision to vacate the job. Ralph Whitworth, currently an HP director, will take up the position on an interim basis until a new chairman is found.

Lane will stay on as a director at the company.

Additionally, HP announced that two other directors have resigned from the board. John Hammergren and G. Kennedy Thompson are to depart in May, serving until that month’s board meeting. As with the chairman position, the company has begun a search for replacements.

Hammergren and Thompson are both longtime board members. They have been directors for eight and seven years, respectively.

The article Hewlett-Packard Chairman to Relinquish Post originally appeared on Fool.com.

Fool contributor Eric Volkman has no position in Hewlett-Packard. The Motley Fool has no position in Hewlett-Packard. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance

HP: A Small Victory for Shareholders

By Alex Dumortier, CFA, The Motley Fool

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Stocks clawed back some of yesterday’s losses today, with the S&P 500 , and the narrower, price-weighted Dow Jones Industrial Average gaining 0.4%.

Reflecting these gains, the VIX Index , Wall Street‘s fear gauge, fell 2%, to close below 14. (The VIX is calculated from S&P 500 option prices and reflects investor expectations for stock market volatility over the coming thirty days.)

HP: Finally, something to cheer about
Last December, I asked, Is Yahoo! a Model for H-P?, arguing that:

There’s no question that HP could use a board shakeup and possibly a new CEO. Much of the change at Yahoo! came at the impetus of activist investor Dan Loeb. HP already has an activist investor in place: Ralph Whitworth of Relational Investors joined the board in 2011. What is he waiting for?

It appears that the board of Dow component Hewlett-Packard is finally taking some responsibility for the disastrous lapses in governance that have inflicted enormous harm on the company and its shareholders over the past several years.

According to a press release published today, Ray Lane will step down as chairman of the board (though he will remain a board member), to be replaced on a temporary basis by Ralph Whitworth. Two other members, John Hammergren and G. Kennedy Thompson, are also resigning their seats. Whitworth will also replace Hammergren at the head of the Finance and Investment Committee.

Mr. Lane took the measure of shareholder sentiment last month, when he was re-elected to the board in a proxy vote with a noticeably lukewarm 59% of the votes — the third lowest percentage among all eleven directors. Only Messrs. Hammergren and Thompson scored lower, with 54% and 55%, respectively.

The choice of the permanent chairman and new board members will be a crucial test of the company’s resolve to turn itself around. Over the past few years, HP has been a heavyweight champion when it comes to destroying goodwill, both the accounting variety, through disastrous acquisitions, and that of its shareholders. Today’s announcement is a step in the right direction, but the journey to restoring the company’s good name on Wall Street will be a long one.

The massive wave of mobile computing has done much to unseat the major players in the PC market, including venerable technology names like Hewlett-Packard. However, HP‘s rapidly shifting its strategy under the new leadership of CEO Meg Whitman. But does this make HP one of the least-appreciated turnaround stories on the market, or is this a minor blip on its road to irrelevance? The Motley Fool’s technology analyst details exactly what investors need to know about HP in our new premium research report. Just click here now to get your copy today.

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Source: FULL ARTICLE at DailyFinance

HP Chairman Ray Lane Resigns, Whitworth Takes Over For Now

By DailyFinance Staff

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Reuters reports that the chairman of HP has resigned:

Hewlett-Packard Co (HPQ) Chairman Ray Lane, who has come under fire from shareholders for his role in the botched, costly acquisition of British software firm Autonomy Plc, has stepped down, the company said on Thursday.

Director Ralph Whitworth will become interim chairman, the company said on Thursday.

On March 20, HP “rebuffed a shareholder rebellion aimed at ousting the two longest-serving directors from personal computer maker’s board,” according to the Associated Press. Lane was not one of those two, but he was said to be “facing significant resistance.” Lane was backed by 59 percent of the vote in his bid for reelection; had he received less than 50 percent, he would have been required to resign under the company’s rules.

Some shareholders said the dissent was sufficient to cause a reshuffling. “I think you can expect to see some evolution of the board in the coming years, months maybe,” said Ralph Whitworth, who joined the board in 2011. CEO Meg Whitman, however, gave all board members a vote of confidence, saying, “I feel like the line-up we have right now is actually helping us turn around the company.”

This is a developing story. Check back for updates.

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Source: FULL ARTICLE at DailyFinance

Relational Investors LLC and CalSTRS Question Timken Board's Willingness to Act in the Best Interest

By Business Wirevia The Motley Fool

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Relational Investors LLC and CalSTRS Question Timken Board’s Willingness to Act in the Best Interests of All Shareholders Following Meeting with Board Members


Timken Family-Influenced Board Continues to REBUT Investment Community Consensus To Separate Company’s Two Core Businesses And Eliminate The Stock’s Long-Standing “Conglomerate” Discount


Relational and CalSTRS Urge Shareholders To VOTE FOR CalSTRS’ Proxy Proposal To Unlock Shareholder Value At Timken By Separating The Company’s Steel And Bearings Businesses And Having Them Trade Independently

SAN DIEGO–(BUSINESS WIRE)– Relational Investors LLC (“Relational”) and the California State Teachers’ Retirement System (“CalSTRS”), collectively owners of 7.28% of the shares of The Timken Company (NYS: TKR) (“Timken” or “the Company”), called into question the ability of the family-influenced Board of Directors to act in the best interest of all of the Company’s shareholders following today’s meeting at the Company’s Canton, Ohio headquarters. The Board is unwilling to separate Timken’s Steel and Bearings businesses to unlock shareholder value and continues to support the Company’s “conglomerate” structure which impairs its stock price.

Anne Sheehan, director of Corporate Governance at CalSTRS, commented, “Timken’s Board invited CalSTRS to meet with representatives of management and the Board today. The meeting followed the filing of our February 27, 2013 shareholder presentation. From the outset, we have tried to work with the Board to unlock the Company’s inherent value for all shareholders through the separate public trading of Timken’s Steel and Bearings businesses. It is clear that there is consensus in the investment community supporting this initiative based on published analyst reports, calls with the Company’s investors, and Timken’s stock price. Nevertheless, the Board has consistently turned a blind eye to what the marketplace is saying.”

Ralph Whitworth, founder and principal of Relational, said, “Despite Timken‘s preempting today’s meeting with a press release yesterday, we hoped that at today’s meeting Timken’s management and Board would finally understand the powerful value proposition that flows from the overwhelmingly compelling and detailed case we have presented to create value through two separately traded companies. Instead, while the meeting was cordial, we met with the same amorphous arguments and faulty math that has characterized the company’s response all …read more
Source: FULL ARTICLE at DailyFinance

Relational and CalSTRS Assert That Timken's Shareholder Presentation is Flawed and Misleading

By Business Wirevia The Motley Fool

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Relational and CalSTRS Assert That Timken’s Shareholder Presentation is Flawed and Misleading

Shareholders Urged To VOTE FOR CalSTRS Proposal

SAN DIEGO–(BUSINESS WIRE)– Relational Investors LLC (“Relational”) and the California State Teachers’ Retirement System (“CalSTRS”), collectively owners of 7.28% of the shares of The Timken Company, (NYS: TKR) (“Timken” or “the Company”), today stated that an investor presentation filed this morning by Timken presents a highly flawed and misleading analysis with respect to the CalSTRS proposal to spin off Timken’s Steel business to unlock shareholder value. The spinoff would create two publicly traded Timken entities – Steel and Bearings – ending the conglomerate discount which has consistently impaired the company’s stock price. Relational, Timken’s largest independent, public shareholder, fully supports the CalSTRS proposal, which is before shareholders for the Company’s annual meeting on May 7, 2013.

Ralph Whitworth, founder and principal of Relational, stated, “It is shocking that Timken would underestimate its shareholder’s intelligence by using such erroneous analysis as justification to not unlock value for Timken shareholders. In our numerous conversations with many of Timken’s largest shareholders, there is a consensus view that the Company should spinoff the Steel business.”

The facts are straightforward and Timken, try as it might, can’t hide or justify these realities:

  • Since November 15, 2012, shortly before Relational and CalSTRS filed their Schedule 13D advocating for the separation of Timken’s Steel and Bearings businesses, Timken’s stock price has outperformed its peers by 41%, or over $15 per share.
  • Timken’s Board must know that if it maintains the Company’s conglomerate structure rather than separate its businesses as recommended in the CalSTRS shareholder proposal, there is a significant risk that the price of Timken’s shares will fall precipitously.
  • Timken’s synergies analysis is highly flawed and contrived. It does not reflect the clear opportunity to mitigate dis-synergies as SKF did following the separation of its businesses and, which we cited in our Timken shareholder presentation. Indeed the mid point of Timken’s projected dis-synergies of $6-8 per share is no more than $2.65 per share higher than what we projected in our conservative analysis. And, as Timken knows or should know, there is ample opportunity to mitigate this incremental dis-synergy through supply arrangements.

Furthermore:

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Source: FULL ARTICLE at DailyFinance