Daniel Loeb may have won a contested endorsement in his bid to shake up the staid Sotheby’s (NYSE:BID) board of directors after launching a well-defined marketing campaign.
Institutional Shareholder Services backs Loeb after Sotheby’s courted them
The well-regarded proxy advisor Institutional Shareholder Services, utilized by small and mid-sized institutional investors, said on Thursday that it was backing the Loeb bid after being actively courted by Sotheby’s (NYSE:BID). “The dissidents have laid out a series of broad questions they believe the board is not, but should begin, taking up,” the ISS report said. “There is credible reason to believe their larger criticism about strategic myopia has some credibility.”
“Old master painting in need of renovation”
Loeb had labeled Sotheby’s (NYSE:BID) lackluster performance as due to “strategic myopia,” saying the company is “an old master painting in desperate need of renovation.”
To combat the influence of the ISS report, Sotheby’s released select preliminary figures from its first-quarter earnings on Wednesday night – nearly two weeks before they were due, a report in the Financial Times said.
Shares of Sothebys are nearly 4% higher on the news as Sotheby’s (NYSE:BID) released a statement. “Now is not the time to diverge from Sotheby’s leadership and its strategic plan. We believe that replacing any of Sotheby’s director nominees with Mr Loeb or any of his handpicked nominees could negatively impact shareholder value.”
Direct marketing campaign showing results
The marketing campaign to win the hearts and minds of Sotheby’s (NYSE:BID) shareholders dove into apparently successful attacks by Loeb on sitting Sotheby’s board members, as reported in ValueWalk. In a letter to Sotheby’s shareholders, Loeb had criticized each of the board members, few if any of whom own stock in Sotheby’s, Loeb emphasizes. Loeb had also built a web site and issued a PowerPoint presentation in an effort to sway investors.