Olin to give activist Sachem Head two board seats

17:41 PM | March 2, 2020 | Robert Westervelt

Olin has reached agreement with activist Sachem Head Capital Management (New York) to add two Sachem Head–backed directors to its board, effective immediately. Sachem Head disclosed a significant stake in Olin on 25 February and said at the time it intended to nominate four directors to Olin’s board. Sachem Head owns approximately 9.5% of Olin’s outstanding shares.

With the appointments, the Olin board will be comprised of 14 directors, 13 of whom are independent and 6 of whom will stand for reelection at the company’s upcoming 2020 annual meeting. The agreement with Sachem Head also includes creation of an operational improvement committee that will consist of the two Sachem Head–backed board members and two current independent directors that will analyze and make recommendations to the board regarding operational improvements and support and inform the board's review of Olin's strategy.

"As we continue to take actions to enhance our capital structure, accelerate our cost discipline and efficiency efforts, and drive long-term value for all shareholders, we are confident that their expertise will be additive to the Board's ongoing efforts," said John Fischer, Olin chairman and CEO.

The Sachem Head–backed members added to Olin’s board are Scott Ferguson, founder and managing partner of Sachem Head Capital Management, and W. Barnes Hauptfuhrer, who most recently served as CEO of Chapter IV Investors. The independent Olin board members who will sit on the operational improvement committee are Scott Sutton, former COO of Celanese, and John O'Connor, CEO of JH Whitney Investment Management. Sutton will act as chair of the committee. 

"We appreciate the constructive and open dialogue we have had with Olin's board and leadership team and look forward to continue working closely with them," said Ferguson.

Olin also agreed to propose, at its 2020 annual meeting, an amendment to its bylaws that would destagger the board starting with the 2021 annual meeting. Any director elected at or after the 2021 annual meeting will face election on an annual basis if the proposal passes. Sachem Head has also agreed to customary voting and standstill provisions through the earlier of 31 December 2020 or the 60 days prior to which shareholder nominations are permitted for 2021 annual meeting.