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A big shareholder in Harley-Davidson is looking for significant modifications to the corporate’s board, arguing CEO Jochen Zeitz and two alternative long-time contributors must be got rid of.
H Companions Control mentioned Wednesday it was once asking alternative Harley-Davidson shareholders to forged “withhold” votes on the later shareholder assembly in Might when the re-election of Zeitz and two alternative board contributors, Thomas Linebarger and Sara Levinson, is going up for a vote.
The company’s stake within the motorbike corporate quantities to roughly 9.1%. Certainly one of its principals, Jared Doureville, was once on Harley-Davidson’s board from February 2022 till previous this presen, when he resigned.
The company brand for Harley Davidson Bikes is displayed at their bind at Disney Springs at Walt Disney International on June 1, 2024 in Orlando, Florida. (Picture via Gary Hershorn/Getty Photographs / Getty Photographs)
Shareholders vote casting to “withhold” can be “sending a strong message to the Board that they are dissatisfied with the status quo and that meaningful change is required,” the funding company mentioned in a submitting with the Securities and Change Fee (SEC).
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In a publicly-available letter, H Companions advocated for Harley-Davidson’s board to “immediately remove” and change Zeitz with an intervening time CEO “until an external, permanent CEO is selected.”
“We believe an absentee CEO who has already announced his intention to retire should not be making decisions that could affect the long-term prospects of the business,” the funding company mentioned. “We also believe that the current Board, which is tightly controlled by a small number of entrenched Board members, cannot be trusted to oversee crucial decisions, including CEO succession.”
| Ticker | Safety | Utmost | Alternate | Alternate % |
|---|---|---|---|---|
| HOG | HARLEY-DAVIDSON INC. | 22.45 | +0.83 | +3.86% |
Previous this presen, Harley-Davidson noticeable it was once in the middle of the method of discovering a pristine CEO to breaking in for Zeitz, who knowledgeable the board within the ultimate quarter of utmost yr that he sought after to abdicate.
H Companions says the motorbike corporate skilled “poor performance” on account of an “inability to course-correct” that it in part blamed on Zeitz and Linebarger.
A detailled view of a facet of a Harley-Davidson motorbike visible on Whyte Street in Edmonton, Alberta, Canada, on Sept. 10, 2023. (Artur Widak/NurPhoto by way of Getty Photographs / Getty Photographs)
It alleged the 2 “have not been fully transparent with the rest of the Board.” Zeitz, Linebarger and Levinson are “entrenched” and are “unable to hold each other accountable for poor performance,” it additional claimed.
H Companions mentioned in its SEC submitting that it was once “deeply concerned that if the Board – as currently constituted – were to select the new permanent CEO, there will be a continuation of the Company’s current strategic direction and further destruction of significant shareholder value.”
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As of Wednesday, stocks of Harley-Davidson have fallen over 24% for the reason that get started of the yr. Over the pace twelve months, they’ve posted a 42.7% subside.
“We believe it is imperative to find a leader who will repair the relationship with dealers, engage with riders, respect and strengthen the brand, improve the corporate culture, restore the physical presence of the Company at its historic Milwaukee headquarters, and return Harley-Davidson to greatness,” H Companions mentioned in its letter to shareholders.
FOX Trade reached out to Harley-Davidson for remark.
In early February, the corporate mentioned it generated $4.12 billion in income in 2024, a 14.9% subside year-over-year. Its annual internet source of revenue, in the meantime, fell to $455.36 million.
Harley-Davidson brand is visible alike the bind in Krakow, Poland, on Jan. 24, 2024. (Jakub Porzycki/NurPhoto by way of Getty Photographs / Getty Photographs)
Zeitz mentioned on the hour that Harley-Davidson “saw our performance being significantly impacted by the continued cyclical headwinds for discretionary products, including the high-interest rate environment affecting consumer confidence” in 2024.
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The corporate’s forecast for 2025 mentioned its income can be “flat, to down 5%.”
