Activism
Relational Investors says change needed at Home Depot
Relational Investors
has notified
Home Depot that it intends to propose a shareholder resolution at the home
improvement retailer’s next AGM requesting that a special committee of
independent directors is appointed to evaluate the strategic direction of the
company and the performance of management.
Home Depot's board said it would oppose the resolution
and has backed the current management of the company. Relational Investors has
also suggested it may nominate one or more directors for election at the AGM.
Home Depot said that it agreed to Relational Investors' request for a meeting,
which it intended to arrange early this month, in order to discuss the
institutional investor's concerns.
The company recently admitted that its investigation
into stock option practices had found that from 1981 to the present, errors in
the granting of stock options had led to unrecorded expenses of around $200m. Both the US Securities and Exchange
Commission and the New York State
attorney general are currently examining Home Depot’s option granting
practices. However, the investigation said it had found no evidence of
management wrongdoing.
Links
Relational Investors
Home Depot
Securities and Exchange
Commission
New York State
Attorney General
January, 2007 |
