The company announced Monday that its CEO, David W. Hockenbrocht, was resigning from the firm, to be replaced by an interim executive, Richard Langley. This was good news for Shapiro who had been complaining about Hockenbrocht's management of the business since last year.
"The truth is that fiscal 2007 was not an isolated event, it was just worse than usual," Shapiro wrote in an October filing with the Securities and Exchange Commission. "Clearly Mr. Hockenbrocht and this board are out of touch. Shareholders have suffered long enough."
Shapiro, who is seeking to have the company consider strategic alternatives such as a sale, also has argued that the company has been misallocating capital of late. Shapiro also said in a Jan. 11 SEC filing that the company was mishandling its Defined Benefit Pension Plan and had been maintaining an excessive amount of company stock in its pension plan and using those shares to entrench senior managers in the face of his insurgency. To resolve these problems, Shapiro has proposed a series of governance changes including having the company conduct a full independent investigation of possible Erisa and fiduciary duty violations. - Ron Orol
See earlier stories about Sparton from Dealscape
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.
