The Woodlands, Texas — Huntsman Corp. shareholders have backed the materials company's current board in the face of a challenge from an activist investor group.
In January, Starboard Value LP, a New York firm that owns almost 9 percent of Huntsman shares, nominated four new directors, including Starboard CEO Jeffrey Smith and longtime plastics and chemicals executive James Gallogly, who previously served as CEO of LyondellBasell Industries and most recently was president of the University of Oklahoma before retiring in 2019.
Smith had said that Huntsman's historical operating performance "has dramatically understated the intrinsic value of the company's assets" and that its "decade-long valuation discount to peers is a clear sign of investor skepticism."
Following a March 25 vote, however, Huntsman Chairman, President and CEO Peter Huntsman said the board had spoken to almost all of its 100 largest shareholders during the process.
"We have transformed our product portfolio to focus on value over volume and fully deleveraged our balance sheet earning an investment grade rating," he said. "The outcome of [the] shareholder vote is validation of our portfolio strategy and recognition that the Huntsman of today is vastly different to the Huntsman of five years ago."
Following the re-election of the existing Huntsman board, its members voted March 28 to authorize "a doubling of its existing share repurchase program from $1 billion to $2 billion."
"As a result of the many discussions we had with our shareholders over the past few months, supported by strong guidance from our newly refreshed board of directors, I am delighted to announce a substantial increase to our share repurchase program," Peter Huntsman said in a news release. "We have one of the strongest balance sheets in the industry ... and we will maintain our investment grade credit rating while deploying cash appropriately to shareholders."
The Woodlands-based Huntsman will release its first quarter financial results April 29.
Huntsman employs 9,000 worldwide and posted sales of just over $6 billion in 2020. The firm is a leading producer of polyurethanes and other specialty plastics and chemicals.