Starboard Loses Effort to Gain Huntsman Board Seats

Shares of Huntsman closed Friday at $35.98, down 11%. The stock is up 29% over the past 12 months.

The Wall Street Journal reported in September that Starboard had taken a stake in the company and had plans to agitate for change at the chemicals producer, citing people familiar with the matter.

In a letter to shareholders, Starboard said that since it got involved with Huntsman, the company has made several promises to shareholders, largely around its adjusted earnings before interest, taxes, depreciation and amortization.

In October, Huntsman also said its board had authorized a $1 billion share repurchase program, which retired an existing plan. During the company’s investor day in November, Chairman, President and Chief Executive Officer Peter Huntsman said the company would look to use that authorization over the next two to three years.

Huntsman has also said it is initiating a strategic review for its textile effects business.

In 2019, Huntsman sold two of its units in a $2.1 billion deal that separated out one of its slowest-growing businesses and gave it cash to expand its core polyurethane operation.

“While we may not be on the board, rest assured that we will be watching with great interest,” Starboard managing member Jeff Smith said in the shareholder letter.

Huntsman said the outcome of the vote was a validation of its portfolio strategy but pledged to build on a high level of shareholder engagement prompted in part by Starboard’s campaign.

“While we had our differences with Starboard on the key issue of Board composition, we appreciated the constructive dialogue we had with them on that topic as well as several other business matters since their initial investment,” the chemicals producer said.