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 Activist investor Barington Capital Group LP has taken its insurgency at Dillard's Inc. up a notch Wednesday by nominating a minority slate of four director candidates to the department store chain's 12-person board. One of the candidates is Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware and a known governance expert.
The likelihood that Barington would launch a proxy contest at the Little Rock, Ark.-based company was high after the hedge fund on March 4 asked Dillard's to provide a list of shareholders. Having a list of shareholders enables Barington to reach out to other investors and gain support for its proxy contest. Barington and its partner, the Clinton Group, together own a 5.2% stake. In addition to Elson, the Barington nominees include Barington director James Mitarotonda, Nick White and Eric S. Salus, who all have retail backgrounds. The activists also are recommending operational and strategic improvements, such as
The activist funds also would like to see the company complete a sale-lease back of owned properties, a typical tactic considered by activist investors seeking to have corporations raise capital for other purposes such as stock buybacks or special dividends. Other activist investors and shareholders interested in backing either Barington or the incumbent board still have an opportunity to buy shares. The annual meeting is scheduled for May 17, and shareholders that have a stake as of March 31 are eligible to vote shares at the meeting. Interesting trivia, Barington's founder Mitarotonda was once a Bloomingdale's employee. Additional coverage will come later in The Daily Deal and on TheDeal.com. - Ron Orol See Barington's SEC filing Ron Orol is a Washington-based reporter for The Deal and author of Extreme Value Hedging: How Activist Hedge Fund Managers Are Taking on the World. Categories Deal Video
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