An investment firm with a roughly 7% stake in major Connecticut employer Pitney Bowes Inc. is seeking an overhaul of the company’s board of directors after more than 10 years of “value destruction,” the company said in a letter to shareholders Monday.
Hestia Capital Management LLC is the third largest stockholder of Pitney Bowes, a Stamford-based technology company known for its mailing and equipment services. In the letter, Hestia said it intends to nominate a majority slate to the board, including an interim CEO, during the company’s 2023 annual meeting.
Hestia said it began engaging with Pitney Bowes this summer, providing specific suggestions to the company’s leadership.
“In particular, we repeatedly emphasized that the Company’s cash-generating segments – SendTech and Presort – are exceptional businesses that can underpin a lasting turnaround once they are operated more efficiently and are better aligned with strategic opportunities in their industries,” the letter states.
Pitney Bowes’ leadership ultimately rejected those suggestions, according to the letter.
Hestia said that many stockholders are frustrated with the company’s “operational underperformance, poor capital allocation, stockholder value destruction and declining creditworthiness.” The letter specifically blames Chairman Michael Roth and CEO Marc Lautenbach.
Hestia also accuses the company’s leadership of trying to “go around our back and recruit one of Mr. Lautenbach’s personal friends in Connecticut, who owns minimal shares, to join the board as a ‘stockholder representative.’”
The letter is signed by Kurt Wolf, founder and chief investment officer of Hestia.
