Denton's Kodak Tangle
Gets a Mixed Review
Who's afraid of Herbert Denton ?
Mr. Denton has gained lots of attention in recent weeks for tangling with Eastman Kodak Co. He recently convened a meeting of restive investors, and now warns that if Kodak doesn't rein in costs and take other steps, a proxy war might ensue. His moves are one of the reasons Kodak shares recently have moved higher.
But while Kodak's brass is taking Mr. Denton seriously -- Chairman Daniel Carp agreed to a second sit-down with him next week -- other investors are raising questions about his tactics and his support base.
Mr. Denton, for instance, owns less than 1% of Kodak's shares. And while he claims that major investors support his activity, he won't reveal their names and says he isn't formally representing them.
In addition, Mr. Denton is hoping to profit directly from the turmoil, as he has sometimes in the past with companies he has targeted. He is pressing Kodak to set up a shareholders committee, and says he wants that committee to name his firm, Providence Capital Inc., as a financial adviser.
Kodak officials say they don't have any information on which investors, if any, Mr. Denton is working with. A Kodak spokesman, Anthony Sanzio, says the company regularly meets with various institutional investors, including Mr. Denton. He says Kodak has rejected Mr. Denton's recommendation for a new shareholder committee.
Mr. Denton is keeping up the pressure. He has told Kodak directors and others that investors, including Carl Icahn, might mount a hostile bid for the company. He also says he has met with Mr. Icahn, but acknowledges he isn't representing Mr. Icahn.
Mr. Icahn has been buying up Kodak shares and owns between 1% and 2% of the company, according to a person close to the situation. Mr. Icahn says: "I have not spoken to Mr. Denton or any of his representatives" since October.
Joan E. Lappin, president of Gramercy Capital Management Corp., a New York investment-advisory firm, who attended the recent Kodak shareholder meeting hosted by Mr. Denton, says the meeting appeared to be little more than a "marketing" effort by Mr. Denton's firm to find clients. "These guys are opportunists," says Ms. Lappin, who adds Gramercy holds a small Kodak position.
Ulysses Yannas, an analyst with Buckman, Buckman & Reid, also was unimpressed. Mr. Yannas, who said he owns 2,000 Kodak shares, said there was little evidence at the meeting that Mr. Denton had any significant support of institutional investors or that any consensus emerged as a result of it.
He said Mr. Denton broke up the meeting after he, Ms. Lappin and another investor raised questions about Mr. Denton's proposals.
Mr. Denton says the meeting concluded after he finished his presentation. He said only two people out of 163 who attended either in person or by telephone had anything critical to say about the meeting or the suggestions emerging from it.
In a series of interviews, Mr. Denton says he doesn't represent a formal group of Kodak investors; instead, he says he has "access" to one-third of the company's shareholders. Bill Miller, the star mutual-fund manager at fund company Legg Mason, which owns about 10% of Kodak's shares, sat in the front row of Mr. Denton's investor meeting, according to people at the meeting.
Nancy Dennin, a portfolio manager at Legg Mason, said the company pays Providence Capital trading commissions, as it does with some other firms, in exchange for "research on corporate governance matters."
She said Mr. Miller attended Mr. Denton's shareholder meeting "for informational purposes. We are not part of any group."
Mr. Denton says he has already made "a lot" of money from the recent rise in Kodak stock. Mr. Denton bought shares when they fell below $21; they have since risen to $23.94. Mr. Denton says his main motivation is the excitement of being a force for corporate change.
"Wouldn't it be fun to stitch together the entire institutional investor" community "and act as though you had their mandate," he said. "That's what I'm doing. One day I'll make a lot of money out of it."
In the past, Providence Capital has held meetings of unhappy shareholders of Aetna Inc., Digital Equipment Corp., Walt Disney Co. and Tyco International Ltd. In recent weeks, Mr. Denton has been advising a group of Hollinger International Inc. investors, leading up to and following Chairman Conrad Black's ouster as the company's chief executive.
Sometimes his efforts have helped him attract fees. Last year, for example, Mr. Denton pressed HealthSouth Corp., the Birmingham, Ala., hospital company, to improve its corporate governance.
After his complaints, he was hired as an independent adviser to the corporate-governance committee at HealthSouth, and paid about $50,000 in fees for his advice, according to people close to the matter. People close to HealthSouth's board praised Mr. Denton's work developing recommendations to improve the company, but they say the recommendations never were fully implemented because HealthSouth's difficulties ballooned.
Mr. Denton has been criticized for possible conflicts of interest. In 2000, he was appointed a director at PolyMedica Corp., a Woburn, Mass., medical-supply company.
At the time, PolyMedica's chairman was Steven Lee, Mr. Denton's former Wharton Business School roommate. Mr. Lee was later a one-time investor in Providence.
Sam Shanaman, the lead director and interim chief executive at PolyMedica, said: "Bert Denton is a very active and valued member of PolyMedica's board." Mr. Lee is no longer working for PolyMedica and couldn't be reached to comment.
Mr. Denton has other supporters as well. Charles Elson, a corporate-governance expert at the University of Delaware, says Kodak should listen to Mr. Denton because he is an effective mobilizer of institutional shareholders to improve corporate policy.
"The fact that he's there signals that there's a problem that has to be addressed," Mr. Elson said. "To ignore his suggestions would be a mistake."
丹顿对柯达的如意算盘
有谁害怕赫伯特?丹顿(Herbert Denton)呢？
由于同伊士曼-柯达公司(Eastman Kodak Co.)的纠纷，丹顿近几周来颇为引人注目。他最近还召集了柯达投资者会议，并警告称，若柯达不削减成本并采取其他改进措施，将可能发起股份控制权之战。他的这些举动是该股近期走高的原因之一。
柯达董事长丹尼尔?卡普(Daniel Carp)同意下周同丹顿举行第二次谈判，尽管这显示柯达高层对待丹顿的态度逐渐严肃起来，但其他投资者却对他所持的策略，以及他到底获得了多大支持产生了疑问。
丹顿仅持有柯达不到1%的股份。尽管他宣称很多大投资者支持他的行动，但他并未公布这些投资者的名称，并表示，他并不正式代表这些投资者。
更有甚者，丹顿还企图直接从这场乱局中获利，这与他过去的所作所为相似。他施加压力，促使柯达设立一个股东委员会，而且他表示希望该委员会指定他的公司Providence Capital Inc.为其提供财务咨询。
柯达管理层表示，他们没有任何参与丹顿计划的投资者的信息。柯达发言人安东尼(Anthony Sanzio)称，公司同包括丹顿在内的很多机构投资者经常联络。他称，柯达已经拒绝了丹顿组建股东委员会的提议。
丹顿正在施加更大的压力，他曾对柯达董事及其他人士称，包括卡尔?爱康(Carl Icahn)在内的多个投资者可能会寻求敌意收购该公司。他还表示已经同爱康会面，但承认他并不代表爱康。
知情人士称，爱康曾经买高柯达股票，并持有该公司1%-2%的股份。爱康称，“从10月份以来，我从未同丹顿或他的代表交谈过。”
纽约投资咨询公司Gramercy Capital Management Corp.的总裁琼?莱苹(Joan E. Lappin)参加了丹顿近来召集的股东会议，她表示，该会议看起来似乎仅仅是丹顿的公司为招揽客户进行的一场营销而已。
Buckman, Buckman & Reid分析师尤利塞斯(Ulysses Yannas)称，会议上没有证据表明丹顿获得了机构投资者的有力支持，或者由此产生了任何一种一致意见。
丹顿称，他结束陈词后会议便结束了。亲自出席或透过电话会议方式参与的163人中仅有两人对会议和会议提出的建议发表了评论。
丹顿在多次采访中表示，他并不是一个柯达投资者正式组织的代表；不过他称，他同三分之一的公司股东有接触。与会人士称，持有柯达约10%股份的Legg Mason的共同基金经理比尔?米勒(Bill Miller)在丹顿的投资者会议上坐在前排。
Legg Mason投资经理南希?丹宁(Nancy Dennin)表示，公司向Providence Capital支付交易佣金，也向其他一些公司支付此类佣金，以获得对于公司治理事宜的研究信息。
丹宁称，米勒出于了解相关信息的目的参加了丹顿发起的投资者会议，但并不是任何阵营的成员。
丹顿表示，柯达股价近期的上扬让他挣了一大笔钱。丹顿在21美元以下买入了柯达股票，之后该股一路涨至23.94美元。但丹顿表示，他的主要动机是享受成为推动柯达变革力量的快乐。
过去，Providence Capital召集过多次“不满股东”的会议，矛头曾指向安泰保险公司(Aetna Inc., AET)、Digital Equipment Corp.、沃尔特-迪斯尼公司(Walt Disney Co., DIS)和泰科(Tyco International Ltd., TYC)。近几周，丹顿一直建议Hollinger International Inc.的一些投资者将董事长布莱克(Conrad Black)拉下首席执行长的职位。
丹顿的种种努力有时为他带来了回报。例如，丹顿去年就一直对医院运营商HealthSouth Corp.施压，要求其改进公司治理。
随后，他迅即被聘为HealthSouth公司治理委员会的独立顾问，知情人士透露，他获得了约5万美元的咨询费。HealthSouth董事会的消息人士对丹顿提出的治理建议赞赏有加，但却表示，由于HealthSouth的处境日益艰难，这些建议并没有得到完全实施。
丹顿还被指责是潜在利益冲突的制造者。2000年，他被任命为医疗供应商PolyMedica Corp.的董事。当时PolyMedica的董事长是丹顿在沃顿商学院(Wharton Business School)的室友史蒂文(Steven Lee)，史蒂文后来也曾是Providence的投资者。
PolyMedica的董事兼临时首席执行长萨姆(Sam Shanaman)称，丹顿是PolyMedica董事会中一名非常活跃而又极有价值的成员。目前史蒂文已不在PolyMedica任职，记者未能联系到他发表评论。
丹顿并非没有支持者。特拉华大学(University of Delaware)公司治理专家查尔斯(Charles Elson)称，柯达应该倾听丹顿的建议，因为他能够有效地策动机构股东，要求该公司改进管理。
查尔斯称，他的出现往往表明，公司治理确实存在问题急需解决，忽略他的建议将不是明智之举。
