Private investment firm Sun Capital Securities Group Inc. on Tuesday urged the shareholders of Furniture Brands International Inc. to vote in favor of its three director nominees at the furniture maker's annual meeting on May 1.
"Our objective is to elect directors who will act in the best interests of all Furniture Brands shareholders by implementing a more dynamic turnaround strategy capable of restoring profitability and shareholder value and/or pursuing strategic alternatives that deliver higher and certain value to shareholders," Jason G. Bernzweig, vice president of SCSF Equities LLC, wrote in a letter to shareholders.
Bernzweig went on to say that under current board leadership, the company's stock price and financial performance have deteriorated significantly and that the board appears to have given little consideration to proposals to acquire the company.
In a letter to shareholders last Friday, Furniture Brands said its strategic plan is gaining traction and that the company has more cash and less debt than any time since 1993. The company also said income more than doubled in the first quarter.
"The entire executive leadership team and board of directors of Furniture Brands believe we consistently act in the best interest of all stockholders," wrote Chairman W.G. Holliman and Vice Chairman and Chief Executive Ralph P. Scozzafava.
Earlier this month, Sun Capital said an affiliate, SCSF Equities, planned to nominate three candidates to the furniture maker's board.
The nominees are Yale Law School professor Alan Schwartz; Ira Kaplan, chief financial officer of Claire's Stores Inc.; and T. Scott King, managing director of Sun Capital.
Sun Capital owns about 9.5 percent of the St. Louis-based company's stock.
In February, Furniture Brands rejected a takeover offer from Sun Capital and later disclosed that the firm had offered to pay between $13 and $15 per share.
Furniture Brands shares dropped 18 cents to $13.82 in morning trading.
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