NEW YORK (HedgeWorld.com)–Hedge fund manager Greenlight Capital Inc. and Mercer International Inc., a European pulp and paper manufacturing company, continue to vie for the votes of Mercer shareholders in the election of new members to the company’s board next month.
As a long-term investor in Mercer and the company’s largest shareholder, Greenlight claims Mercer’s bad corporate governance is harming the stock. It filed a proxy statement with the Securities and Exchange Commission nominating Guy Adams and Saul Diamond to the board, in a bid to counter the current trustees .
Mercer Chief Executive Jimmy Lee wants shareholders to reject these nominees and elect his own candidates, Per Gundersby and Michel Arnulphy. “Greenlight’s actions are not in the best interests of shareholders,” Mr. Lee asserted in a statement. “Greenlight does not
want independent, qualified trustees but, in fact, wants hand-picked agents who are extremely well compensated by Greenlight to pursue its own agenda.”
He avers that Greenlight rejected a proposal to have an independent search firm look for two trustees to be added to the board. In a letter to shareholders, he also took issue with the hedge fund manager’s complaint that management actions caused Mercer’s stock to lose more than 50% in the past five years.
“Such rhetoric is unjustified in that the company’s primary product is pulp, which is largely a commodity product, subject to wide price fluctuations,” he wrote, arguing that Mercer’s share tracks this commodity.