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York Asset Management Limited Intends to Vote against Re-Election of Board Nominated Directors.

NEW YORK -- York Asset Management Limited ("YAML") today delivered to Hillenbrand Inc. ("Hillenbrand") a letter clarifying its reasons for intending to vote against the re-election of certain incumbent directors at the upcoming Annual General Meeting, further to previous correspondence outlining its concerns about the current CEO's capital allocation process.

In today's letter addressed to Mr. Ray Hillenbrand, Chairman of Hillenbrand, Nick Walker of YAML wrote: "we as long term shareholders have decided to withhold the vote of our shares for incumbent directors because they have supported a capital allocation process by the current CEO which is ill disciplined and risky, as demonstrated by the recent non-core acquisition strategy."

Mr. Walker added: "Hillenbrand is a high quality business, which has been built patiently over one hundred years into a highly cash generative, predictable enterprise. It is a great shame that at this pivotal moment in the company's history, the Board of Directors have chosen to support a controversial and mediocre capital allocation process unbefitting Hillenbrand's world-class core operations."

YAML has been a shareholder of Hillenbrand and its former parent since 2005.

THIS IS NOT, NOR SHALL IT BE DEEMED TO BE, A SOLICITATION OF PROXIES FOR THE COMPANY'S UPCOMING ANNUAL GENERAL MEETING.

Text of two letters to Hillenbrand follow:
Delivered February 19, 2010

Ray Hillenbrand
Chairman
Hillenbrand, Inc.
One Batesville Boulevard
Batesville
Indiana 47006


Dear Mr Hillenbrand,

Hillenbrand, Inc. wrote to certain shareholders who are intending to withhold votes for the election of incumbent directors at next week's AGM in a letter publicly filed and dated February 18, 2010. The letter assumes the reason for shareholder discontent relates to the lifetime benefits paid to the retired CEO of Hillenbrand Inc.'s former parent corporation and current director, Gus Hillenbrand.

Instead, we as long term shareholders have decided to withhold the vote of our shares for incumbent directors because they have supported a capital allocation process by the current CEO which is ill disciplined and risky, as demonstrated by the recent non-core acquisition strategy.

To prevent any possible confusion that could be caused by the company's publicly stated assumption of certain shareholder voting intentions, we therefore feel it necessary to make public the true reason why we are voting in this manner, publishing this letter and our previous one to CEO Kenneth Camp dated February 12, 2010, which described our concerns over his recently announced acquisition.

Hillenbrand is a high quality business, which has been built patiently over one hundred years into a highly cash generative, predictable enterprise. It is a great shame that at this pivotal moment in the company's history, the Board of Directors have chosen to support a controversial and mediocre capital allocation process unbefitting Hillenbrand's world-class core operations.

Yours sincerely,

York Asset Management Limited
Delivered February 12, 2010

Kenneth A. Camp
President and Chief Executive Officer
Hillenbrand, Inc.
One Batesville Boulevard
Batesville
Indiana 47006


Dear Mr Camp,

Hillenbrand, Inc., the largest provider of burial caskets in the nation, is a high quality business producing strong and stable returns on capital in an uncertain economy. We are long term investors, shareholders since 2005.

As CEO, responsible for capital allocation, your willingness to pursue the controversial growth strategy of acquiring companies operating outside your industry of expertise at a significant premium to market prices caused us concern when you first outlined it during the investor day on December 3, 2008. Nevertheless we continued to invest in Hillenbrand since you consistently assured investors that you would be disciplined - you promised all cumulative acquisitions to December 2011 would cost no more than $200 million - and because you explained that non-core acquisitions would represent just one of three types of acquisition target, with the other two acquisition types being within the burial caskets and broader death care industries in which you actually possess a track record of success. Strategy statements such as the following, "We are targeting approximately $100 million to $200 million in acquisitions over the next three years," (10-Q filed December 9, 2008) were repeated several times in conference calls and filings in subsequent months and are a matter of public record.

Inexplicably, you raised the amount of capital that you were willing to dedicate to the acquisition strategy to "several hundred million dollars" in the 10-K filed November 24, 2009 and, without further discussion with shareholders through quarterly investor calls or the like, proceeded to spend more than double your original intent for all types of acquisition on a single, non-core acquisition costing $435 million.

Now that you have gone back on your word regarding the amount of shareholder's capital which you are willing to spend on acquisitions, and have been able to classify this patently non-core acquisition as compliant with existing covenants which prohibit Hillenbrand from making any acquisition outside its core area of business, long-term shareholders like ourselves who previously trusted your stewardship of future cash flows from this remarkable core business must ask: what restraint now exists that future capital allocation will be even as you yourself predict?

Sincerely,

York Asset Management Limited

About York Asset Management Limited ("YAML")

Founded in 1995, YAML is an asset management company with over US$250 million in assets under management and having offices in London, NY, Cayman Islands and Rio de Janeiro.
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Publication:Business Wire
Geographic Code:1U2NY
Date:Feb 22, 2010
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