Clayt Daley: Lenox Wealth Management Q&A
Two years ago, Lenox advised P&G clients and shareholders that if P&G did not improve profitability and fix the pipeline for new products, it was likely another investor would take a significant ownership position in P&G and begin to push for change.
Today, P&G is in the middle of a proxy contest with Trian Fund Management, L.P. (“Trian”), one of P&G’s largest shareholders which is seeking a single Board seat for its CEO and a founding partner, Nelson Peltz.
In the typical situation, we would expect Lenox and P&G employees and retirees to side with Management and the Board by approving their slate of proposed directors.
However, this determination has been complicated by several factors:
- Former P&G CFO Clayt Daley, has joined with Trian as an advisor.
- The Company and its stock price have significantly underperformed industry and competitor benchmarks for many years.
- The Board and David Taylor have taken the unusual step of launching an aggressive defense campaign which has been estimated by some to be expected to cost up to $100 million to prevent Nelson Peltz and Trian Partners from securing a single board seat, even though Nelson, if elected, has committed to proposing that the P&G Board immediately re-appoint which ever director is not re-elected at the P&G annual meeting of shareholders.
As you will recall, Lenox Savings and Loan was created in 1887 by William Cooper Procter to help meet the financial needs of the Procter & Gamble community. In 2004, Lenox took the proceeds from the sale of the savings and loan and launched a family office. Today, Lenox has a significant number of P&G employee, retiree and executive retiree clients, who have been negatively impacted by the underperformance of P&G stock over the last 10 years.
John Lame, the CEO of Lenox, worked at Procter & Gamble in finance and accounting from 1979 to 1991, where he reported to Mr. Daley.
In an attempt to gather more complete and objective information to advise clients, Mr. Lame contacted Mr. Daley and asked him to respond to specific questions about his involvement with Trian and the ongoing proxy contest with Procter & Gamble.
Click here to read the John's interview with Clayt Daley, former P&G CFO who recently joined Trian as an advisor.