Berry Global Group Inc. has entered into a "mutual agreement" with two activist investment firms that have been working with the company to boost shareholder value.
Evansville, Ind.-based Berry announced Nov. 23 that it has entered into a mutual cooperation agreement with shareholders Ancora Holdings Group LLC and Eminence Capital LP.
A year ago, Ancora sent a letter to Berry management calling for changes in how the company manages finances. At the time, it said that options included selling the company.
Since then, Berry has repurchased shares and announced plans to institute a dividend for the first time in company history. Ancora and Eminence officials are now signaling support for Berry management and the company's strategy.
"We appreciate the productive private engagement we have had with the board and management regarding the board's refreshment efforts. We believe Berry is positioned for a strong future and can drive enhanced value for all stakeholders," Fred DiSanto, chairman and CEO of Ancora, said in a Nov. 23 news release from Berry.
Ricky Sandler, founder CEO and chief investment officer at Eminence, added: "We have appreciated our constructive dialogue with Berry, which has built an impressive leadership position in the packaging industry as well as an attractive and durable financial profile. We look forward to continuing to engage and support the company's leadership team as it executes its strategy and pursues new paths to value creation over time."
Berry also announced the appointment of three new independent directors and that the board has created a capital allocation committee, "which will make recommendations to the board and support management's review of the company's capital allocation strategy."
In a recent earnings call, Berry CEO Tom Salmon said "Berry is stronger than it ever has been and this dividend initiation underscores our commitment to enhancing long-term value for all stakeholders."
The three new directors are Meredith Harper, senior vice president and chief information security officer at Synchrony Financial; Chaney Sheffield, a partner at Canyon Partners LLC; and Peter Thomas, the former chairman, president and CEO of Ferry Corp.