Activist investor Barington Capital Group LP is continuing to pressure plastic materials and products firm Omnova Solutions Inc. by nominating three directors for that firm's board — including Joseph Gingo, who helped steer a turnaround at materials firm A. Schulman Inc.
The nominations of Gingo, management consulting veteran Javier Perez and Barington chief James Mitarotonda come less than a week after New York-based Barington sent a letter to Omnova Chairman and CEO Kevin McMullen criticizing Omnova's financial performance during the 14 years that McMullen has led the Beachwood, Ohio-based firm. Barington owns more than two percent of Omnova's common stock.
Barington officials repeated some of their concerns in a Dec. 9 news release announcing their nominees, who will be officially nominated at Omnova's annual meeting in mid-March.
“Barington has been disappointed with Omnova's share price performance, which has underperformed its peers and the market as a whole over the past 14 years,” they said. “As a result, Barington has nominated a slate of three highly qualified individuals to assist the company in improving long-term shareholder value.
“If elected, these directors will seek to work constructively with Omnova's other directors to improve, among other things, the company's profitability, strategic focus, organic growth, corporate governance and executive compensation practices.”
Barington's nomination of Gingo, 69, for the Omnova board is somewhat ironic, since he took the leadership of Fairlawn, Ohio-based Schulman in 2008 after a similar challenge from Barington and investment firm Ramius Capital Group LLC. Previously, Gingo had served on Schulman's board for several years.
Under Gingo, Schulman has made 10 acquisitions and exited lower-profit commodity work for higher-end specialties. The firm's annual sales have recovered from a recession-low of $1.6 billion to $2.1 billion for fiscal 2013, while the firm's earnings per share also have soared from 87 cents in fiscal 2007 to $2.36 for fiscal 2014.