The fight between WisdomTree and ETFS Capital, which holds a combined 18.3% of WisdomTree’s outstanding common stock on an as-converted basis, erupted in April over the performance of the firm and the launch of its digital wallet.
WisdomTree accused of ‘desperate smears’ by largest shareholder as conflict escalates
In a letter yesterday (12 June), ETFS Capital once again attacked the firm, arguing it has “presided over the destruction of $1bn of stockholder value”.
In the firm’s AGM, scheduled for 16 June, ETFS Capital has nominated three board members to replace Frank Salerno (chair of the board and compensation committee), Win Neuger (chair of the nominating and governance committee) and Anthony Bossone (chair of the audit committee).
In response to the attacks, WisdomTree said in a shareholder letter yesterday that it had now committed to rotating at least two of three committee chairs by the end of this year.
However, it still held that the incumbent members should be maintained, as five of the eight current board members are new, meaning if Salerno and Neuger were replaced, the lack of experience “would be disruptive and create dysfunction”.
“We would lose integral experience and progress if any of them – including and especially Frank Salerno and Win Neuger – are replaced by ETFS Capital’s nominees,” WisdomTree added.
ETFS Capital has continually rallied against the three chairs, demanding their resignations since the conflict erupted earlier this year. It described the changes made to WisdomTree’s board as “insufficient and disingenuous”.
Proxy voting
Last week (6 June), independent proxy advisory firms Glass Lewis and ISS both offered mixed opinions on WisdomTree.
Glass Lewis recommended stockholders vote for ETFS Capital nominee Tonia Pankopf and against chair Salerno, but said it still found management’s vision for the firm “more compelling” than ETFS Capital’s plan.
Meanwhile, ISS recommended voting for all three of ETFS Capital’s nominees against the incumbent WisdomTree board members.
In a statement, ISS said: “There are lingering questions about the board’s openness to fresh independent points of view given the fact that the three longest-tenured board members, Bossone, Neuger, and Salerno, chair all the committees, and Salerno, who has been on the board for 18 years, is the chair of the board.”
However, WisdomTree said yesterday that both proxy services had “recently affirmed our corporate governance enhancements”.
