HomeBusinessActivist Barington urges manufacturer TriMas to consider selling company

Activist Barington urges manufacturer TriMas to consider selling company

By Svea Herbst-Bayliss

NEW YORK (Reuters) – Activist investor Barington Capital Group wants TriMas to launch a strategic review of options, including the possible sale of the entire company, arguing in a letter that hiring a financial advisor is a higher priority than finding of a new CEO.

The New York-based hedge fund, which owns about 1.5% of the Bloomfield Hills, Michigan-based industrial, aerospace and consumer products maker, is ramping up the pressure days after TriMas said CEO Thomas Amato will step down.

“This is the optimal time for the Board of Directors to explore strategic alternatives for the company and (we) do not believe that hiring a new CEO, who will embark on a new strategic plan for the next five to ten years, is in the best interest of the shareholders.” Barington founder James Mitarotonda told TriMas chairman Herbert Parker in a letter seen by Reuters.

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A TriMas representative did not immediately respond to a request for comment.

Barington, a longtime investor in TriMas, has argued for years that the packaging, aerospace and specialty products segments are a mismatch and that the mini-conglomerate structure has contributed to a lagging stock price. The hedge fund has urged TriMas to divest its aviation and Arrow Engine units.

TriMas, which has a market value of just under $1 billion, has seen its share price fall 25.5% over the past five years, closing trading Wednesday at $23.12.

Barington said the company made mistakes and failed to clean up its portfolio during Amato’s eight years as CEO.

Barington said it wants the board to think more boldly and consider the sale of each company individually, but also consider the sale of the company as a whole.

Amato plans to leave in late June or earlier once a replacement is found, but Barington said hiring a new CEO would delay the review and sale process.

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Activist investors like Barington are expected to step up demands on target companies to make deals this year, as a new president enters the White House and after mergers and acquisitions already accelerated last year.

Last year, for example, aerospace parts maker Barnes Group was taken private by Apollo Funds.

Barington has made headlines in recent weeks for pushing retailer Macy’s to make changes to boost its share price and organizing a governance challenge at casket maker Matthews International.

Barington plans to continue its proxy fight at Matthews even after the company this week announced plans to sell one of its units that the hedge fund had been pushing for.

(Reporting by Svea Herbst-Bayliss; Editing by Jamie Freed)

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