Starboard Outlines Comprehensive Operational Improvement Plan On Newell Brands

Starboard Value LP, a significant shareholder of Newell Brands Inc. (NWL) with beneficial ownership of about 3.8% of the Company’s outstanding shares, said that it has released a detailed presentation outlining the opportunity to create meaningful value at Newell. With a renewed focus on operations and improving EBITDA, Starboard believes Newell can increase annual profitability by almost $1 billion, and in turn, substantially increase the stock price.

Based on operational improvement plan, 2019 EBITDA would increase to about $3.1 billion (with Working Capital ultimately decreasing by about $800 million to $1.1 billion), resulting in a significantly higher value for Newell.

Starboard believes that Newell owns many valuable assets – and should evaluate strategic alternatives for them – but the strategic review must be comprehensive and weigh ALL options to determine what is best for long-term shareholder value creation.

Starboard said that Newell should look to sell brands and businesses only if they can receive a high after-tax multiple such that the sale is value accretive.

Starboard noted that Newell’s EBITDA margins are significantly below management’s targets and best-in-class peers, despite its product portfolio consisting of valuable brands in large, growing, and unconsolidated global categories.

by RTTNews Staff Writer

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