In the latest instance of a big shareholder squaring off with current directors over the composition of a restaurant company’s board, Sandell Asset Management is accusing Bob Evans of inappropriately trying to screen the investors’ nominees. Bob Evans has yet to respond publicly.
Tom Sandell, CEO of Sandell Asset Management Corporation, one of the largest shareholders of Bob Evans Farms, Inc. (NASDAQ:BOBE) ("Bob Evans" or the "Company"), issued today the following statement to the Board of Directors (the "Board") of Bob Evans.
May 30, 2014
Ladies and Gentlemen:
We were dismayed to learn from our outside counsel that the Company's so-called Lead "Independent" Director, Michael Gasser, sent a letter on May 27, 2014 to the eight independent Director nominees proposed by Sandell Asset Management Corporation inviting each of them to a hastily-convened and unorthodox round of individual questioning by Mr. Gasser and "certain other" Directors at the Company's headquarters in New Albany, Ohio. In this letter, Mr. Gasser appears to be attempting to inappropriately subvert the Director nomination process and we view this action as particularly troubling, as at no time had the Company attempted to contact us to achieve a constructive solution that might include the addition of some or all of these highly-qualified Director nominees as part of comprehensive change at the Board.
In addition, at no point in our almost year-long dialogue with the Company has the Board shown the slightest inclination towards reaching an amicable resolution with us. This latest attempt to end-run one of the Company's largest shareholders represents yet further evidence of the Board's unwillingness to engage in truly constructive dialogue, which is a dis-service to all shareholders.
Notwithstanding our significant concerns regarding the judgment exhibited by the current Board, along with the repeated earnings disappointments and operational missteps occurring under the leadership of Chairman and CEO Steven Davis, our conviction in the underlying value of the unique assets of Bob Evans has grown stronger. To unlock this value, however, the Company in our view urgently needs a new, truly independent Board that is able to exert effective management oversight - that is why we have submitted the nomination of eight highly-qualified Director nominees, including three former restaurant CEOs with decades of relevant industry experience. These nominees possess a mix of critical skill sets and expertise necessary to drive the operational, financial, and strategic change that we see as needed to deliver long-term value to the shareholders of Bob Evans.
We remain willing, as we have for nearly a year, to meet with Mr. Gasser and the rest of the Company's Board in order to engage in good faith and constructive dialogue should the Board wish to genuinely seek a comprehensive solution that would contemplate the addition of these highly-qualified Director nominees to the Company's Board. We cannot countenance, however, attempts by the Company to actively subvert the Director nomination process.
Chief Executive Officer