Canada’s largest food processing company seeks shareholder input and new board members
A newly formed shareholder relations committee has started the process of revamping the board of directors at Maple Leaf Foods as the company is faced with a shift in ownership and displeased shareholders.
The committee expects to seek input from large investors and recruit a search firm that will hire new independent board members to bring the board closer to its commitment of renewal, the company said.
To better facilitate the renewal process, committee members will be meeting with large shareholders to seek their views on governance since the investor profile of the Toronto- based firm has changed ‘considerably.’
‘We are looking forward to engaging with our shareholders, and making changes that further strengthen our ability to provide oversight to ensure this company maximizes sustainable return to shareholder,’ says James Hankinson, chair of the committee.
The international food processing firm anticipates that the creation of the committee will formalize the process in an effort to identify and recommend changes to the board after the departure of Ontario Teachers’ Pension Plan (Teachers’), who sold more than half of its shares in the company after Teachers representatives resigned. Last month, Teachers', one of the largest shareholders of Maple Leaf decided to sell off its holdings for $220.5 million at a significant discount.
As one of Canada’s biggest asset managers, Teachers’ has been long reconsidering its investment into Maple Leaf Foods after the board members resigned due a disagreement about a modernization plan, which includes the elimination of some plants.
Moreover, the company is currently facing a proxy battle with its second investor, activist hedge fund West Face Capital, over concerns about board independence, Reuters reports.
Over the past two years, Maple Leaf Foods, which is also one of Canada’s largest bakers, has been faced with strong competition from other US rivals that resulted into a massive recall, according to news sources.
The company employs about 23,500 people at operations across Canada, US, UK and Asia.
