Major Proxy Advisory Firm Glass Lewis Recommends That Timken Shareholders VOTE FOR CalSTRS’ Shareholder Proposal
25 Aprile 2013 - 3:00PM
Business Wire
The California State Teachers Retirement System (“CalSTRS”) and
Relational Investors LLC (“Relational”), collectively owners of 7.3
percent of the common shares of The Timken Company, (NYSE: TKR)
(“Timken” or “the Company”), today stated that they are pleased
that the proxy advisory firm Glass Lewis & Co. (“Glass Lewis”)
has recommended to its clients that Timken shareholders VOTE FOR
the CalSTRS proposal, Item No. 6 on their proxy cards. CalSTRS’
shareholder proposal calls on the Timken Board to unlock
shareholder value by separating the Company’s two incongruent
business units – Steel and Bearings – thereby eliminating the
stock’s long-standing conglomerate discount.
The CalSTRS proposal now has been recommended by both ISS and
Glass Lewis, the two foremost independent proxy advisory firms.
In its report, Glass Lewis writes:
“In reviewing the fundamental positions
presented by both the board and the Proponents, we generally find
CalSTRS and Relational provide a more compelling quantitative case,
backed by cogent and thoroughly explained analyses."
“We find the board’s own quantitative
analyses offer shareholders relatively poor insight, due, in part,
to the application of what we consider to be questionable
methodologies."
“We are concerned the board is presenting
shareholders with a skewed perspective on the stand-alone value of
Timken’s BPT and steel businesses in order to diminish the
perceived value of a split-up."
“We find the Proponent provides a more
realistic and verifiable estimate of the potential value available
to Timken’s current shareholders through the spin-off."
“We ultimately find clear merit in the
Proponents’ arguments and believe shareholders would strongly
benefit from a more thorough review of this potential strategic
alternative."
“The incumbent board has displayed, in our
view, a clear and troubling track record of responsiveness to
shareholder concern and, perhaps of greater note here, has strongly
expressed its intention to pursue the status quo."
“We believe shareholders should support this
proposal and, by extension, strongly encourage the board to conduct
a thorough review of the prospective merits associated with the
spin-off transaction contemplated by the Proponents.”
Anne Sheehan, director of Corporate Governance at CalSTRS,
commented, “We welcome Glass Lewis’ recommendation for our
proposal, Item No. 6 on the Timken proxy card. Timken’s
conglomerate structure continues to depress shareholder value while
our proposal provides a clear alternative to the status quo. The
independent recommendation from Glass Lewis, along with the earlier
recommendation from ISS, crystallizes the importance of
shareholders voting FOR CalSTRS’ proposal as it will send a clear
message to the Timken Board to end the Company's conglomerate
structure and unlock shareholder value.”
Ralph Whitworth, founder and principal of Relational, said, “We
appreciate Glass Lewis’ careful consideration and its important
recommendation in favor of CalSTRS’ proposal. These recommendations
by the two leading proxy advisory firms, Glass Lewis and ISS,
underscore that the Timken Board needs to pay attention to the
broad based investment community support that has developed for
CalSTRS’ proposal to unlock shareholder value at Timken.”
WHERE TO GET MORE INFORMATION
For additional information regarding CalSTRS’ value-unlocking
shareholder proposal, please visit www.UnlockTimken.com
SHAREHOLDER PRESENTATION
On April 15, 2013, Relational and CalSTRS filed a supplement to
their March 21, 2013 shareholder presentation: “Timken’s Flawed
Analysis”:http://www.sec.gov/Archives/edgar/data/98362/000110465913029264/a13-10050_1px14a6g.htm.
Below is a link to the March 21, 2013 shareholder presentation:
“Why a Separation of Timken’s Steel and Bearings Businesses Can
Unlock Significant Shareholder
Value”:http://unlocktimken.com/library/uploads/2013/03/ShldrPrsntnUpdate.pdf.
The presentation demonstrates the financial and operational
logic of CalSTRS’ shareholder proxy proposal, which enables Timken
shareholders to vote for separating the two businesses.
About Relational Investors LLC: Relational Investors LLC,
founded in 1996, is a privately held, multi-billion dollar asset
management firm and registered investment adviser. Relational
invests in publicly traded companies that it believes are
undervalued in the marketplace. The firm seeks to engage the
management, board of directors, and shareholders of its portfolio
companies in a productive dialogue designed to build a consensus
for positive change to improve shareholder value.
About the California State Teachers Retirement System:
The California State Teachers’ Retirement System, with a portfolio
valued at $163.7 billion as of March 31, 2013, is the largest
educator-only pension fund in the world. CalSTRS administers a
hybrid retirement system, consisting of traditional defined
benefit, cash balance and voluntary defined contribution plans, as
well as disability and survivor benefits. For 100 years, CalSTRS
has served California's public school educators and their families,
who now number 862,000 from the state’s 1,600 school districts,
county offices of education and community college districts.
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