Dive Brief:
- J.M. Smucker is appointing two independent directors to its board as part of an agreement with activist investor Elliott Investment Management.
- The Uncrustables and Folgers coffee maker said Woo-Sung (Bruce) Chung, the CFO at NRG Energy, and former Snyder's-Lance CEO David Singer will join the board on April 15.
- Elliott said the deal comes following “constructive engagement” with Smucker. Marc Steinberg, a partner at Elliott, added that the new board members “represent critical steps toward ensuring The J.M. Smucker Company reaches its full potential.”
Dive Insight:
The food space in recent years has been a hotbed of activity for activist investors looking to shake up a sector struggling with a contraction in consumer spending and a push toward healthier offerings. Most recently, PepsiCo agreed to cut the number of products it sells after Elliott disclosed it amassed a $4 billion stake in the snack and beverage giant in September.
Mark Smucker, the company’s CEO, said in prepared remarks discussing the company’s earnings that he is confident the jam and peanut butter manufacturer has “the right strategy and leadership team in place to support long-term value creation for all of our shareholders.” He added that the new board members are “proven executives with track records of creating value” and will bring “additional skills and experiences to accelerate our ongoing business momentum.”
Smucker has been making changes to its business amid higher coffee prices and challenges with its $5.6 billion acquisition of Hostess Brands in 2023. Mark Smucker said last week that it has taken the company “longer than we expected” to position the Hostess business for growth.
Earlier this month, Smucker shook up its leadership ranks, which included eliminating its COO and giving CFO Tucker Marshall oversight of the company’s U.S. retail frozen handheld and spreads, sweet baked snacks and international businesses. Last week, Smucker told analysts it was cutting back on promotions of sweet baked snacks and reducing the number of individual products it sells by 25%.
Smucker on Thursday reported a 7% increase in net sales to $2.34 billion for its third quarter. The food and beverage maker reported strength in its coffee business, which was offset by lower sales in its sweet baked business following a fire at its Kansas facility.
