New York investment firm Ramius Capital Group LLC is at it again - using its status as a large shareholder to try to force underperforming plastics companies to sell.
This time, the target is Fairlawn, Ohio-based resin maker and compounder A. Schulman Inc., whose sales have been nearly flat or negative for the past six years.
Ramius, which owns 7.6 percent of Schulman shares, filed a proxy statement Oct. 22 with the Securities and Exchange Commission, saying it wants Schulman to put itself up for sale. Ramius has nominated four candidates to fill soon-to-be-vacant seats on the board of directors.
In addition to two Ramius partners, the hedge fund also nominated Michael Caporale Jr., former president and chief executive officer of Cuyahoga Falls, Ohio-based Associated Materials Inc.; and Lee Meyer, former CEO of Kearney, Mo.-based Ply Gem Industries Inc.
Ramius officials declined to comment. Schulman officials could not be reached for comment.
``We have been owners of Schulman for several years and believe the company has not made adequate progress on improving profitability,'' said Ramius partner Jeffrey Smith in the SEC filing. ``Schulman is a terrific asset. While we think cash flow can significantly improve, we currently believe the best alternative to enhance stockholder value is a sale of the company.''
This move is similar to the action Ramius took in December, when it encouraged Beachwood, Ohio-based Lamson & Sessions Co. to divest its PVC pipe business. At the time, Ramius owned 6 percent of Lamson shares.
In August, Lamson officials announced the sale of their company to Memphis, Tenn.-based electrical products firm Thomas & Betts Corp. for $450 million.
On Oct. 18, Schulman announced fiscal 2007 sales of $1.79 billion.