I guarantee you I've been to more shareholders' meetings than you have.
I've never attended as a shareholder. I don't own any stock in an individual company. However, for nearly three decades, I've been attending meetings of companies that I write about.
One thing about these meetings is that shareholders rarely show up. With a few exceptions, the investors who buy shares don't live in the same town as the company's headquarters, and it's not worth the expense of traveling.
Even if the meeting is conveniently located, it is generally held in the middle of a workday and shareholders are not willing, or able, to take time from their jobs to attend.
Because of that, I've always believed that reporters play a vital role at shareholders' meetings. We're the eyes and ears of the shareholders who are unable to attend but are still very interested in finding out what happened.
So I was surprised and disappointed last week when I showed up at Atlantic Coast Financial Corp.'s special shareholders meeting and discovered the company was barring the media.
The meeting was held to vote on a controversial buyout offer – which was in fact rejected by shareholders at the meeting – so perhaps company officials were afraid that things would get ugly.
Closing the doors to the meeting gave an unfair advantage to everyone who was in the room, and there was at least one stockholder there who is not a company insider.
Atlantic Coast Financial officials said they did not want any information about the meeting to get out until they could issue a news release on the wires. Obviously, a rejection of the buyout offer would have an impact on the market price of the stock.
The company issued its news release about 30 minutes after the meeting ended. During that half-hour, any shareholder who was in the room had the opportunity to phone his or her broker with a sell order, before the rest of the market was able to get the news.
Some companies go as far as broadcasting their annual meetings on the Internet so everybody will receive the same news at the same time.
It seems especially important when stockholders are voting on a merger proposal.
I had been barred from a shareholders' meeting only one other time, in 2007 when Winn-Dixie Stores Inc. held its first annual meeting after emerging from Chapter 11 bankruptcy.
The company was expecting a protest from the People for the Ethical Treatment of Animals, which was pushing the company to purchase chickens only from suppliers that slaughter the animals humanely. PETA had publicly announced its position months before so it wasn't big news, if that was the reason the media were left on the outside.
Although PETA did raise the chicken issue at Winn-Dixie's 2007 meeting, I was much more curious to see if shareholders would show up and who they were.
Before the bankruptcy, Winn-Dixie was one of those rare companies that had a large base of local stockholders who did attend annual meetings. All of those shareholders were wiped out in the Chapter 11 reorganization, so I wanted to see what a stockholders' meeting was like at the new Winn-Dixie. But I didn't get the chance.
Let's be perfectly clear: There is no Sunshine Law issue here. The media has no legal right to be allowed access to a shareholders' meeting. People sometimes misunderstand the term "public company" to mean the company is a public entity, but it's not. Legally, the company has an obligation to its shareholders and nobody else.
However, shareholders rely on the media to provide access and information that they can't readily obtain on their own, and most companies recognize that.
A few months after the 2007 Winn-Dixie meeting, former CEO Peter Lynch apologized for barring me from the meeting and said it was wrong, and it wouldn't happen again. I hope it doesn't happen again anywhere.
One way to attract shareholders to annual meeting
One more note about shareholders attending annual meetings: One local company that used to attract a crowd to its meetings was the now-defunct Family Steak Houses of Florida Inc.
The Neptune Beach-based company was the Florida franchisee for the Ryan's Family Steak House chain, and one perk of attending its annual meeting was a coupon good for a free meal at the Ryan's restaurant near the corporate headquarters. The shareholders loved that.
The stock price of Family Steak Houses dropped sharply in the early 1990s and many investors lost money, but what about the people who showed up at the annual meeting every year? At least they received something from their investment with several years of free meals.
I was reminded of that perk last month when I was one of the few people who attended Fidelity National Financial Inc.'s annual meeting. The title insurance company is now heavily invested in the restaurant industry, owning a majority stake in seven chains.
I told Fidelity CEO George Scanlon about Family Steak Houses' policy and suggested maybe Fidelity could give out free meal coupons at future meetings.
So, if Fidelity begins offering restaurant vouchers to shareholders, remember to thank me.
McKesson committed to PSS sales force
When McKesson Corp. announced its agreement to buy Jacksonville-based PSS World Medical Inc. last fall, the San Francisco-based medical supply giant said it liked PSS' sales force and hoped to retain those people.
At a Goldman Sachs investor conference last week, McKesson Chief Financial Officer Jeff Campbell again stressed the importance of keeping the PSS sales organization.
"When you look at an acquisition like this, the retention and continued enthusiasm of the sales team is critical because this is a business where those salespeople really tend to own many of the customer relationships, more than PSS as a company does, more than McKesson does as a company," Campbell said.
"Our goal is to lose no reps other than normal attrition. Our goal is to lose no revenues. And so far, so good," he said.
Of course, it's not all good news for PSS employees because while McKesson needs the sales force, it doesn't need the PSS headquarters operations.
The company, which closed the acquisition in February, has not made any specific announcements about cuts but has said it expects to achieve $100 million in annual cost savings four years from now.
"You get rid of overhead costs, you get some purchasing synergies and over a long period, three or four years, you take out some infrastructure, a lot of infrastructure," Campbell said last week.
PSS employed about 780 people in Jacksonville and 4,000 in total across the country when the acquisition was announced.
Campbell said some investors are asking McKesson why it will take three to four years to fully integrate PSS' operations.
"The answer is because you really have to do it thoughtfully and carefully, never losing sight of operational excellence," he said.
"The day one of those sales reps feels that, boy, I can't get my customer what they want because they just closed one distribution center and a new one doesn't have what I need, that's the day you create customer risk and create risk for those salespeople," he said. "We're going to be really thoughtful over the next few years about how we do that."
Florida Blue forming holding company
Jacksonville-based Florida Blue last week said it filed a request with the Florida Office of Insurance Regulation to organize as a policyholder-owned, not-for-profit mutual insurance holding company.
The company said the move will give the health insurer flexibility "to achieve the strategic objective of transforming into a health solutions company."
Florida Blue CEO Patrick Geraghty said in a news release that changes in the health insurance and health care industries are creating opportunities for the company to expand its services.
"We believe the MIHC structure will help us better fulfill our mission over the long term, deliver sustained value to our customers and compete in a rapidly changing environment," he said.
The Florida Times-Union reported earlier this month that legislation signed by Gov. Rick Scott included an amendment that allows Florida Blue to acquire other not-for-profit insurers and corporations. The report said the amendment was pushed by lobbyist Paul Sanford, who represents Florida Blue.
Florida Blue said the Office of Insurance Regulation will hold a hearing on its application in the coming weeks and if approved, Florida Blue policyholders will be asked to approve the new structure.
Gannett agrees to big TV deal
Gannett Co. Inc. announced an acquisition last week that will nearly double its portfolio of television stations, which already includes Jacksonville stations WTLV TV-12 and WJXX TV-25.
Gannett, which owns 23 stations, agreed to buy Belo Corp., which owns 20 stations, for $1.5 billion in cash and the assumption of $715 million in debt.
The merger will make Gannett the fourth-largest owner of network-affiliated television stations, the company said.
With media companies dealing with declining advertising revenue from newspapers, the acquisition makes broadcasting a bigger part of Gannett's business.
After completing the merger, Gannett expects its broadcast division will account for more than half of its earnings before interest, taxes, depreciation and amortization.
"We have been successfully transforming Gannett into a diversified multimedia company with broadcast, digital and publishing components across high-growth markets nationwide, and this is another important step in the process," Gannett CEO Gracia Martore said in a news release.
Investors liked the move. Gannett's stock jumped as much as $6.90 to $26.75 Thursday after the merger announcement, its highest level in about five years.
Interline names CFO
Interline Brands Inc. last week named John Bakewell as the company's chief financial officer. Bakewell has spent the past 22 years as CFO of several large public and private companies, most recently at RegionalCare Hospital Partners.
Jacksonville-based Interline, which was acquired by two private equity firms last year, has been searching for a permanent CFO since John Ebner said in December he was resigning the position.
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