C&EN: TODAY'S HEADLINES - HERCULES WINS FIGHT WITH ISP

MARC REISCH

After failing to win the backing of another major Hercules shareholder, International Specialty Products and its chairman, Samuel J. Heyman, withdrew their dissident directors slate at the Hercules annual meeting on July 25.

Joyce
PHOTO BY MARC REISCH

What’s more, Heyman, who controls 9% of Hercules’ shares, said that he and three allied directors elected at last year’s annual meeting would resign from the board, effectively leaving Hercules CEO William H. Joyce the victor in the struggle to control the recovering firm’s destiny.

Addressing shareholders, Heyman said an unofficial count showed he and his allies had secured seats for only two of their four nominees, giving the dissident group six of 13 votes on the board of directors. Failing to gain control, “we withdraw our nominees and terminate our proxy challenge,” he said.

“This contest was never about power or personal aggrandizement, but about the opportunity to get value for Hercules shareholders,” Heyman added. “We believe Bill Joyce is entitled to a clear and open field.”

As Heyman sat down, Joyce called his speech “gracious” and admitted that Heyman had “prodded us to do things we should have done faster.”

The annual meeting was actually the denouement of a series of behind-the-scenes events. A week before the annual meeting, mutual fund manager Mario J. Gabelli, whose Gabelli Asset Management controls 9.8% of Hercules shares, asked Heyman and Joyce to address shareholders at a meeting in New York City. If either did not show, he threatened to throw his support behind the other.

Both men attended the meeting and restated their positions. Gabelli decided to support two of Heyman’s nominees and one of Hercules’ and to abstain on voting for a fourth, effectively supporting Joyce.