SpartanNash is addressing outside board nominations with a new communication and request to shareholders.
Ahead of its annual shareholder meeting in June, SpartanNash has filed definitive proxy materials with the U.S. Securities and Exchange Commission (SEC) and is sending a letter to shareholders outlining the company’s recent changes and successes and requesting up votes for its director nominees.
The Michigan-based food solutions company is taking those steps in light of the nomination of three board directors by “activist” investors Macellum Advisors and Ancora Holdings Group, which collectively own about 4.5% of SpartanNash’s stock. Those organizations are calling for changes that could include a possible sale of the entire company, its assets or owned real estate.
In a communication to shareholders, SpartanNash emphasized the company’s ongoing transformation, highlighting increased revenue and EBITDA and the 251% total shareholder return since summer 2019. The company also pointed out the changes to the board of directors that have already been put in place, including the addition of three new directors in February. “The board is confident that the skillsets of the company's nominees outmatch the Investor Group's slate in every critical area,” the announcement read. “Collectively, SpartanNash's directors possess extensive public company board leadership and operating experience, as well as financial and industry expertise spanning food distribution, retail and consumer goods...The Investor Group's nominees, if elected, would reduce the Board's diversity with directors who are not additive.”
The company was direct in its assessment of the intentions of the businesses seeking to insert their own slate of directors: “The Investor Group is attempting to apply the same cookie-cutter approach at SpartanNash that it has attempted to use at multiple apparel, discount and department store retailers, demonstrating, at best, a lack of understanding of the company's vastly different business model as a distribution and food retail company, and at worst, a blatant disregard of how SpartanNash's business operates.”
SpartanNash pointed out that it has tried to resolve issues with Macellum over the last several months to avoid an expensive proxy contest, but was rebuffed.
SpartanNash’s core businesses include distributing grocery products to independent and chain retailers, its corporate-owned retail stores, and U.S. military commissaries and exchanges, as well as fresh produce distribution and fresh food processing. No. 39 on The PG 100,Progressive Grocer’s 2021 list of the top food and consumables retailers in North America, the Grand Rapids, Mich.-based company serves customer locations in all 50 states and the District of Columbia, Europe, Cuba, Puerto Rico, Honduras, Iraq, Kuwait, Bahrain, Qatar and Djibouti. SpartanNash also operates 146 supermarkets and employs 19,000 associates.