Billionaire investor William Ackman is accusing Automatic Data Processing Inc. of providing misleading and incorrect claims to Institutional Shareholder Services and asked the proxy advisory firm to reconsider its shareholder recommendations, Reuters reports.
ISS on Wednesday issued a report to guide institutional investors in a vote next week where the hedge fund manager hopes to win three ADP board seats. The proxy adviser recommended shareholders largely vote for the company’s slate but supported Ackman’s election.
Ackman’s filing came hours after the human resources outsourcing company’s board chair John Jones said in a letter to shareholders that ADP is not underperforming and plans to improve margins and profit further.
“ADP provided non-public, inaccurate and misleading information, claims, and arguments which were relied upon by ISS,” Ackman said in a regulatory filing made with the US Securities and Exchange Commission.
ADP and ISS had no immediate comment on Monday.
Ackman unveiled his stake of 8.3 percent, including 2 percent in common shares, in ADP in August, and has since criticized the company for what he calls sluggish earnings and inefficient operations. He plans to hold another investor webinar on Nov. 1.
“ISS accepted, and in its Report has publicly endorsed, certain misleading or incorrect factual assertions made by ADP management during its engagement with ISS,” Ackman said in the filing.
ISS said in its recommendation that shareholders should withhold their vote for ADP director Eric Fast to make room for Ackman but that the case was not “sufficiently compelling to justify replacing three directors”.
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