Latest news with #ForwardAir
Yahoo
02-06-2025
- Business
- Yahoo
Proxy adviser backs activist's move to reshape Forward Air board
A major independent proxy advisory firm is backing activist investor Ancora's call for shareholders to vote against three Forward Air board members at the company's upcoming annual meeting. Institutional Shareholder Services Inc. (ISS) has recommended that Forward's (NASDAQ: FWRD) shareholders reject the reelection of Chairman George Mayes and directors Javier Polit and Laurie Tucker, according to a Monday statement from Ancora Holdings Group. Ancora has blamed the trio for overseeing a controversial merger with freight forwarder Omni Logistics. That deal has been publicly panned as it was structured through a series of transactions to circumvent a vote from shareholders. It also left Forward with a debt-laden balance sheet (5.3 times net debt leverage at the close of the first quarter) and ceded a 38% equity stake and voting bloc to Omni's private equity backers. Shares of FWRD tanked following the August 2023 deal announcement and are down 85% since. The company acquiesced to shareholder pressure earlier this year, agreeing to undertake a strategic review of its options, which potentially include selling the company to private equity. Ancora has since accused Forward of 'slow-walking' the review process, saying that it only recently executed nondisclosure agreements with interested parties. 'In light of the urgency for a well-run strategic review process, coupled with the governance failures related to the value-destructive Omni acquisition, there is a case for change at the board level,' ISS stated in its report, per the Ancora statement. 'Shareholders have every right to be concerned about the likelihood of a positive outcome given the board's track record on M&A decision making and the board's utter disregard for investors in the past.' A 50.1% vote is required for the three board members to be reelected. The results of the election will be confirmed at Forward's June 11 annual meeting. The company is also asking shareholders to approve a reincorporation from Tennessee to Delaware, which it says has a more corporate-friendly legal landscape and would make it easier to sell the company. But Ancora has claimed the move was a belated fix to the company's changed stance on Tennessee M&A law, which precluded it from engaging with a potential buyer and thus preserving the current makeup of the board. Forward noted in a Friday filing with the Securities and Exchange Commission that it has been 'taking into account shareholder feedback' as it explores all potential options to maximize value. It also said it has begun talks with 'parties interested in participating in the process,' which presumably include potential buyers. 'The full Forward Air Board is highly qualified and actively engaged in all activities underway, including oversight of the strategic alternatives process. Removing ~30% of the Board at this time is unnecessary and would be destabilizing to the Company and the process,' a spokesperson with Forward Air said on Monday. 'If Ancora is focused on an efficient strategic review process, depriving the Board of critical expertise undermines that very goal.' More FreightWaves articles by Todd Maiden: J.B. Hunt expands premium intermodal offering to shippers in Mexico ArcBest taps CH Robinson veteran to fix asset-light business Truckload spot rates to continue upward trend, RXO says The post Proxy adviser backs activist's move to reshape Forward Air board appeared first on FreightWaves. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
02-06-2025
- Business
- Business Wire
Forward Air Shareholders Recommended to Vote AGAINST Three Unfit Legacy Directors at 2025 Annual Meeting by ISS
CLEVELAND--(BUSINESS WIRE)--Ancora Holdings Group, LLC (together with its affiliates, 'Ancora' or 'we'), a significant shareholder of Forward Air Corporation (NASDAQ: FWRD) ('Forward Air' or the 'Company'), today announced that Institutional Shareholder Services Inc. ('ISS'), a leading independent proxy advisory firm, recommends that Forward Air shareholders vote AGAINST the reelection of three members of the Board of Directors (the 'Board') at the 2025 Annual Meeting of Shareholders: (1.) Chairman and Compensation Committee Chair George S. Mayes, Jr., (2.) Audit Committee Member Javier Polit and (3.) Corporate Governance and Nominating Committee Chair Laurie A. Tucker. In its report, ISS notes the following regarding the case for change at Forward Air: 1 'In light of the urgency for a well-run strategic review process, coupled with the governance failures related to the value-destructive Omni acquisition, there is a case for change at the board level.' 'Shareholders have every right to be concerned about the likelihood of a positive outcome given the board's track record on M&A decision making and the board's utter disregard for investors in the past.' '[Voting against the reelection of these directors would] signal to the board that shareholders expect a genuine, timely, and thorough process.' Fredrick D. DiSanto, Chairman and Chief Executive Officer of Ancora Holdings Group LLC, and James Chadwick, President of Ancora Alternatives LLC, commented: 'ISS has reiterated what sizable shareholders have recognized: investors are best served by removing the targeted legacy directors, who presided over critical governance failures that have contributed to immense value destruction and perpetual risk. As ISS noted in its recommendation, the Company's ongoing strategic review has the potential to destroy even more value if not well executed. Mr. Mayes, Mr. Polit and Ms. Tucker's collective track record – from approving the disastrous Omni acquisition to effectively delaying a leading potential acquirer from participating in the current, slow-moving review – demonstrates they cannot be trusted to make decisions in the best interest of shareholders. Quite simply, their presence on the Board is a detriment to any credible assessment of alternatives. This message from ISS should serve as a wake-up call to the Board about the need to complete an expeditious, yet thorough, process that results in a value-maximizing sale to one of the many suitors interested in acquiring Forward Air. We expect anything short of this outcome will result in a shareholder seeking to remove and replace a majority of the Board." About Ancora Founded in 2003, Ancora Holdings Group, LLC offers integrated investment advisory, wealth management, retirement plan services and insurance solutions to individuals and institutions across the United States. The firm is a long-term supporter of union labor and has a history of working with union groups and public pension plans to deliver long-term value. Ancora's comprehensive service offering is complemented by a dedicated team that has the breadth of expertise and operational structure of a global institution, with the responsiveness and flexibility of a boutique firm. Ancora Alternatives is the alternative asset management division of Ancora Holdings Group, investing across three primary strategies: activism, multi-strategy and commodities. For more information about Ancora Alternatives, please visit THIS IS NOT A SOLICITATION OF AUTHORITY TO VOTE YOUR PROXY. DO NOT SEND US YOUR PROXY CARD. ANCORA IS NOT ASKING FOR YOUR PROXY CARD AND WILL NOT ACCEPT PROXY CARDS IF SENT. ANCORA IS NOT ABLE TO VOTE YOUR PROXY, NOR DOES THIS COMMUNICATION CONTEMPLATE SUCH AN EVENT.
Yahoo
21-05-2025
- Business
- Yahoo
Activist investor pushes Forward Air to execute ‘value-maximizing sale'
Ancora Holdings Group provided a detailed presentation late Tuesday outlining why Forward Air shareholders should vote out 'three unfit legacy directors' it blames for the company's 'disastrous acquisition of Omni Logistics' and 'efforts to stall the company's current sale process.' The activist investor first penned a letter to shareholders two weeks ago calling for the removal of Chairman George Mayes and directors Javier Polit and Laurie Tucker. It said the three will be forced to resign it they don't garner 50.1% of the vote at the June 11 annual meeting. Shares of Greeneville, Tennessee-based Forward Air (NASDAQ: FWRD) closed Tuesday at just $18.04, a far cry from the $110 closing price the stock held prior to the August 2023 merger announcement with Omni. The Omni acquisition was structured through a series of transactions to preclude a vote by shareholders as required by Tennessee law. It was funded with $1.85 billion of debt and gave Omni's private equity backers control over a 38% voting bloc and four board seats. (Some shareholders have taken issue with the entrenchment nature of the deal, as the voting bloc is required to vote in favor of board-chosen directors at elections.)Forward closed the 2025 first quarter at a 5.3 times net debt leverage ratio, an improvement from 5.5 times at the end of the year but significantly higher than the sub-2 times projected for 2025 when the deal was announced. On a combined basis, Forward and Omni had pro forma earnings before interest, taxes, depreciation and amortization of $593 million (inclusive of $125 million in expected deal synergies) for the 12-month period ended June 30, 2023 – the last period prior to the 2023 deal announcement. (Forward closed the first quarter with last-12-months' adjusted EBITDA of just $313 million.) The underperformance required the company to modify its credit agreement earlier this year to avoid breaching a debt covenant of 4.5 times leverage set for later this year. 'Each of the targeted directors was on the Board in August 2023 when it decided to pursue the Omni Logistics LLC ('Omni') acquisition and bears responsibility for the disastrous deal, which was criticized by shareholders and independent onlookers because it burdened the Company with substantial debt, presented operational and integration challenges, and strained customer relations,' the Ancora presentation said.'We believe Forward Air has limited opportunity as a standalone public company – with its level of debt, remaining independent will likely mean additional dilution for the Company's equity holders.' Ancora said Forward's board has been 'slow-walking' a strategic review that was announced at the beginning of the year despite months of pressure from investors to explore selling the company or consider other options. 'Since reactively announcing a strategic alternatives process five months ago to avoid another proxy contest, the Board appears to have made little progress toward achieving a sale, the presentation said. 'Our diligence indicates that non-disclosure agreements have only recently been distributed to interested parties – a necessary first step – despite the fact that Forward Air has had multiple private equity firms in its shareholder base over the last year.' Ancora also accused Forward's board of further entrenchment maneuvers by changing its stance on Tennessee M&A law governing engagement with 'interested shareholders,' or those holding 10% or more of the voting power. 'After choosing to opt out of the Tennessee Business Combination Act for years, the Board suddenly chose not to opt out in 2024 – just a week after a private equity firm [Clearlake Capital Group] reported a 13.8% stake in Forward Air – without disclosing why.' Forward is currently precluded under Tennessee law from engaging with interested shareholders for a five-year period. However, Forward has asked shareholders to approve a reincorporation in Delaware to make it easier to sell the company. (Delaware has similar restrictions for interested shareholders, but the ownership threshold is 15%.) Ancora said the move is simply an effort to 'paper over the Board's past actions' and that 'the board has not disclosed why it determined not to opt out of the Tennessee Business Combination Act, after consistently opting out in previous years.''If truly necessary, the belated Delaware reincorporation plan is further evidence that the Board continues to be two steps behind and is not working proactively to maximize value for shareholders,' Ancora said. 'These directors only take action when their backs are against the wall.' Ancora also said the company isn't improving governance practices as part of the move to Delaware, pointing to the board's restriction on shareholder actions without unanimous written consent and a new clause that narrows the window for calling special meetings. Forward has made moves following the January 2024 closing of the Omni acquisition. It replaced the deal's architect and former CEO Tom Schmitt, among other C-suite changes. The 12-person board has also seen turnover. Forward CEO Shawn Stewart is the only employee on the board. The remaining seats are held by independent directors. Seven of those were appointed after the merger, three of whom were designated by Omni. Other board members have either resigned or decided not to stand for reelection. (A recent proxy filing from Forward calls for the board to be reset at 11 members.) Stewart joined Forward a year ago, after the company was forced to close on the deal. He previously served as a unit head at Ceva Logistics and has added former colleagues to Forward's roster. The new leadership group, however, hasn't formally communicated a go-to-market strategy. In addition to net debt leverage stepping slightly lower in the first quarter, the company's liquidity position improved modestly. The company has worked to improve the freight mix at its legacy expedited less-than-truckload unit. Corrective pricing actions wrapped up in early February, and the business is focused on winning heavier shipments, which often carry better margins. Forward reported a 10.4% adjusted EBITDA margin in the unit in the first quarter, which was 380 basis points better sequentially and outperformed normal seasonal trends. Ancora called out the unit's declining EBITDA and depressed margins since the deal was announced. On a trailing 12-month basis, EBITDA has nearly been cut in half to $106 million and the EBITDA margin is off roughly 400 bps to 9.7%. Ancora pointed to several opportunities for the legacy intermediary to freight forwarders and cargo airlines. It said the company now has direct access to sell to shippers and should be able to better leverage its more than 250 terminals and 40 bonded warehouses. It also estimates that the company's yields are 32% below market despite offering an expedited, premium service. That in part explains the falloff in its expedited LTL operating ratio (inverse of operating margin), which was 93.9% last year (93.7% in the first quarter). It said 'the right leadership team with the right strategy' could move ORs back to the low 80s like they were in 2011 to 2013. 'By utilizing the Company's network, leveraging new shipping partners, effectively pricing its premium offerings and densifying the network on a recapitalized balance sheet, potential suitors have an opportunity to [generate] more than 2.5x operating income [growth] at modest assumed [revenue] growth rates and historical operating ratio levels.' Ancora provided takeout scenarios ranging from 31% to 148% upside to Forward's recent share price based on EBITDA multiples ranging from nine times to 12 times, respectively. 'We have continued to share our view with the Board and management that the best risk-adjusted outcome for all shareholders is a sale of the Company,' Ancora said. 'But Forward Air appears to be running down the clock, reducing the chance of achieving a value-maximizing sale – and increasing the risk of further value destruction should a sale not materialize.' This isn't Ancora's first activist interest in Forward Air. In 2021, it was successful with a plan to improve freight mix, redirect capital allocation and change the board's composition. Ancora currently holds a 4% stake in Forward Air. 'The Board and management team are entirely focused on taking deliberate actions to maximize shareholder value,' a spokesperson with Forward Air told FreightWaves. 'The Board is actively engaged in leading the strategic review process, which, as we noted, is underway, and the continued oversight of our transformation strategy. We firmly believe that all of our directors are vital to these efforts.' More FreightWaves articles by Todd Maiden: FedEx taps leaders from within for LTL spinoff, to Wall Street's dismay April sees mixed freight trends on path to recovery Pamt Corp. CEO resigns for family reasons amid mounting losses The post Activist investor pushes Forward Air to execute 'value-maximizing sale' appeared first on FreightWaves. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
14-05-2025
- Business
- Business Wire
Irenic Expresses Governance Concerns Pertaining to Forward Air Corporation
NEW YORK--(BUSINESS WIRE)--Irenic Capital Management, LP (collectively with its affiliates, 'Irenic' or 'we') today issued the below statement regarding Forward Air Corporation (NASDAQ: FWRD) ('Forward Air' or the 'Company'). Irenic intends to vote against certain legacy members of Forward Air's Board of Directors (the 'Board') at the 2025 Annual Meeting of Shareholders ('Annual Meeting'). "Based on Irenic's independent analysis, we agree with Ancora Holdings Group's decision to withhold support for certain legacy directors at Forward Air's Annual Meeting. Forward Air's legacy directors circumvented the requirement to give shareholders a vote on the acquisition of Omni Logistics LLC in 2023. The Legacy Forward Air Board's maneuvers undermined the shareholder franchise on which the legitimacy of Board-led governance rests. While we respect these three directors as individuals, Forward Air's legacy directors, who usurped authority that properly belongs to shareholders, should have no role in the Company's governance today." About Irenic Irenic Capital Management, LP is an investment management firm founded by Adam Katz and Andy Dodge. Based in New York City, Irenic works collaboratively with publicly traded companies to ensure operating activities, capital deployment and management incentives are all aligned to create value for the company and its owners. For more information about Irenic, please visit
Yahoo
14-05-2025
- Business
- Yahoo
Irenic Expresses Governance Concerns Pertaining to Forward Air Corporation
NEW YORK, May 14, 2025--(BUSINESS WIRE)--Irenic Capital Management, LP (collectively with its affiliates, "Irenic" or "we") today issued the below statement regarding Forward Air Corporation (NASDAQ: FWRD) ("Forward Air" or the "Company"). Irenic intends to vote against certain legacy members of Forward Air's Board of Directors (the "Board") at the 2025 Annual Meeting of Shareholders ("Annual Meeting"). "Based on Irenic's independent analysis, we agree with Ancora Holdings Group's decision to withhold support for certain legacy directors at Forward Air's Annual Meeting. Forward Air's legacy directors circumvented the requirement to give shareholders a vote on the acquisition of Omni Logistics LLC in 2023. The Legacy Forward Air Board's maneuvers undermined the shareholder franchise on which the legitimacy of Board-led governance rests. While we respect these three directors as individuals, Forward Air's legacy directors, who usurped authority that properly belongs to shareholders, should have no role in the Company's governance today." About Irenic Irenic Capital Management, LP is an investment management firm founded by Adam Katz and Andy Dodge. Based in New York City, Irenic works collaboratively with publicly traded companies to ensure operating activities, capital deployment and management incentives are all aligned to create value for the company and its owners. For more information about Irenic, please visit View source version on Contacts Irenic Capital Managementcontact@
