Johnson Matthey: US investor ramps up activist campaign
Johnson Matthey’s largest shareholder has piled pressure on the FTSE 250 chemicals group, calling its response to a demanded strategic review “wholly insufficient”.
In an open letter to Johnson Matthey chair Patrick Thomas, today, US industrials investor Standard Investments slammed the group’s “destruction of shareholder value” as part of its activist campaign.
Last month, Standard published an open letter calling for a strategic review of the business, that could include the sale of “part or all” of the company.
Johnson Matthey responded to the investment firm privately on Christmas Eve, in a letter which today, Standard decried as “wholly insufficient and does not adequately address the many serious issues that we highlighted”.
The JM letter to Standard contained plans for Standard to engage with additional members of Johnson Matthey’s board, as well as a proposal to establish an investment committee to periodically assess “alternative options to the status quo”.
“[The reply] only underscores the continued lack of urgency and incapacity of the current board to do what is necessary to turn Johnson Matthey around and help it to realise its potential,” Standard rebutted, in a second open letter today.
“We have engaged legal, proxy and other advisors as we plan to actively engage with fellow shareholders. We also await a more substantive response to our most recent letter.”
Standard, which became Johnson Matthey’s largest stakeholder in 2023 after nearly doubling its holding to 11 per cent, warned last month that the firm’s board lacked a “sense of urgency” and ability to oversee a turnaround.
Only a single new independent director has joined its board since November 2021, when the firm put its struggling electric vehicles battery materials unit up for sale, it added.
Standard said that while it believed in the “unique value of Johnson Matthey”, a “massive credibility gap” had emerged.
Shares in Johnson Matthey have fallen around 54 per cent over the last five years.