Pier 1 Imports’ largest shareholder, who wants a seat on the company’s board, has made a load of money in the past several weeks as the retailer’s stock has taken off.
But he’s not going away.
Pier 1 shares began rebounding from low points this fall after the election and took off after reporting strong third-quarter results on Dec. 14. Shares rose nearly 50 percent in a week, reaching $9.49 on Tuesday before falling back later in the week to settle at $8.64 on Friday.
The rise has been a boon for Alden Global Capital, a New York hedge fund that disclosed a 9.5 percent stake in Pier 1 in September and proceeded to threaten a board fight. The company said it had acquired 7.9 million shares at prices ranging from $3.86 to $4.16 a share, so the fund has doubled its money.
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But in a letter sent to directors last week, Alden’s President Heath Freeman said the hedge fund still wants representation on the board and a say in who becomes the company’s next chief executive officer.
“We continue to believe that shareholder representation is required on the Board of Directors,” Freeman wrote. “The recent performance, while gratifying, does not address the need for improved governance and a disciplined focus on operational improvements.”
The home furnishings retailer reported net income of $13.6 million for the three months ending Nov. 26, after losses in the first half of the year, and an increase in comparable-store sales. It also raised its full-year guidance.
Pier 1 said its chairman, Terry London, will take over as interim CEO starting Jan. 1 as the board continues to search for a permanent successor to outoing boss Alex Smith.
The investor letter said Alden wants to be involved in the CEO search and executive compensation decisions. “Unfortunately, to date the board has show little desire or interest in working constructively with your largest shareholder. We therefore encourage you to reeevaluate your dismissive approach,” the letter states. The letter was included in a SEC filing in which Alden disclosed that it owns 7.6 million shares, or 9.2 percent of the stock.
A voice and a vote
Tarrant County Tax Assessor-Collector Ron Wright knows he has a voice on how the Tarrant Appraisal District works. But now he wants a vote.
Wright, an ex-officio member of the Tarrant Appraisal District board of directors, attends the meetings and often is the only one to speak out. But that is as far as it goes. He can’t vote.
So Wright would like the agency to change its bylaws to allow him to join the board’s five other members in officially setting policy. Wright is the only elected official on the board; his colleagues are appointed by the county’s taxing entities to represent them.
“I told [TAD Chief Appraiser] Jeff Law and [TAD board Chairman] Tom Potthoff, whatever we need to do to make that happen, I’d like to see it happen,” Wright said. “I have a voice but it’s not the same if you don’t have a vote. I can’t make a motion. I can’t be part of a majority “
There’s no mistaking what Wright thinks of the operations at TAD of late. He has been an outspoken critic of how the agency bungled a software conversion that left property off the rolls and led to last-minute refunds for taxpayers because of reporting snafus. Wright called a recent audit of TAD’s new computer software switch “explosive.”
Wright said the Harris County tax assessor-collector is a voting member of its appraisal agency’s board.
A similar suggestion regarding appraisal board representation is made in Senate Bill 2, the property tax reform bill written by state Sen. Paul Bettencourt. In the Houston Republican’s bill, all of the appraisal district board members would be elected officials, an idea that would make them “directly answerable to the citizens,” according to a statement from Bettencourt.
Farmer Brothers CFO resigns
Farmer Brothers, fresh off winning a proxy fight against the founder’s granddaughter over board seats and the company’s move to Texas, is now looking for a new chief financial officer.
The coffee company, which will soon move into a new headquarters complex near Texas Motor Speedway, said Isaac Johnston is resigning as treasurer and CFO, effective Jan. 6, to accept another opportunity.
Johnston was hired at Farmer Brothers in September 2015, shortly after the company moved to North Texas from California. The longtime Pepsico executive previously served as president of WWW-Winning-Enterprises in Frisco, and before that as CFO at United Surgical Partners in Addison.
“We have a strong finance team in place and are confident this will be a smooth transition,” President and CEO Michael Keown said. “Importantly, our organization is continuing to run on all cylinders.”
Andrea Ahles: 817-390-7631, @Sky_Talk
Max B. Baker: 817-390-7714, @MaxbakerBB
Steve Kaskovich: 817-390-7773, @stevekasko