SPX Corp., an industrial-equipment manufacturer, said it reached an agreement with Relational Investors LLC for the activist investor to nominate up to two board directors.
Relational can nominate David H. Batchelder, who co-founded the fund with Ralph Whitworth, to the SPX board after the 2014 annual meeting, SPX said in a statement today. The investor can nominate a second director for election at the 2015 shareholder meeting. In exchange, Relational agreed to vote for the company’s directors, the pump maker said.
Relational has amassed a 15.5 percent stake in SPX since it began buying the shares in December 2012. SPX that month ended talks to buy rival Gardner Denver Inc. after shareholders balked at the deal. The fund has criticized Charlotte, North Carolina-based SPX’s lagging results.
“Going forward, we believe SPX can unlock additional value for its shareholders by further increasing its operating profit margins, continuing to divest non-core assets, properly balancing growth with investment returns and maintaining its disciplined approach to capital allocation,” Batchelder said in the statement.
Relational in recent years has targeted industrial companies including SPX, bearings maker Timken Co. and Illinois Tool Works Inc.