Illinois Tool Works Agrees To Let Activist Shareholder On Board
January 13 2012 - 5:45PM
Dow Jones News
Illinois Tool Works Inc. (ITW) on Friday agreed to allow a hedge
fund with a reputation for agitating for the breakup of industrial
conglomerates to have a seat on its board of directors.
ITW has been facing increasing pressure from shareholders and
analysts alike to divest a significant portion of its business
portfolio to generate improved sales growth from the remaining
assets. ITW operates more than 800 businesses, generating more than
$18 billion a year in revenue.
The Glenview, Ill., company said its agreement with Relational
Investors LLC gives the fund the an option to appoint David
Batchelder, its principal and co-founder, to ITW's board any time
after ITW's 2012 annual shareholders meeting and 60 days prior to
the compnay's 2013 annual meeting.
Relational Investors, which has acquired 2.1% of ITW stock, was
the driving force behind the breakup of ITT Corp. (ITT) earlier
this year, according to industry analysts and investors.
"We are pleased to have reached this agreement with Relational,"
said Chairman and Chief Executive David Speer in a wrttten
statement. "Our board and management team remain committed to
generating profitable growth and delivering strong returns and we
look forward to continuing to enhance value for all of our
shareholders."
-By Bob Tita, Dow Jones Newswires; 312 750 4129;
robert.tita@dowjones.com
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