Huntsman Corporation HUN
Starboard is running a proxy fight for four Huntsman board seats, arguing a CEO-beholden board allowed 337% S&P underperformance and three missed Investor Day promises.
Thesis
Starboard Value, Huntsman's second-largest stockholder, is waging a proxy fight to replace four directors at the 2022 Annual Meeting, arguing the board is beholden to CEO Peter Huntsman through personal friendships, Huntsman-family charity donations, and financial entanglements that enabled a 337% underperformance versus the S&P 500 since IPO. The letter documents a ~900bps EBITDA margin deficit against primary peers like Celanese, Eastman, and Dow in 2021 — despite Huntsman calling it 'the best year in its history' — and catalogs three consecutive missed Investor Day targets (2014, 2016, 2018), including an unmet $60-per-share promise. Starboard highlights specific director conflicts (Beckerle's $1M+ HCI compensation, Ferrari's post-Venator move to SK Capital, Egan's anti-shareholder tactics) and proposes a chemical-industry slate: Gallogly, Lin, Schnabel, and Smith. The closing ask: vote the BLUE proxy card.
SCQA
Huntsman is an $8.5bn-revenue diversified chemicals company led since its 2005 IPO by CEO Peter Huntsman, overseen by a board long populated by Huntsman-family friends, former employees, and beneficiaries of Huntsman-family philanthropy.
Huntsman has underperformed the S&P 500 by 337% since IPO and trails primary peers by ~900bps in EBITDA margin, a record Starboard attributes to a board beholden to the CEO through friendships, charity donations, and financial conflicts.
Stockholders should vote the BLUE proxy card to elect Starboard's four chemical-industry nominees — James Gallogly, Sandra Beach Lin, Susan Schnabel, and Jeffrey Smith — at the 2022 Annual Meeting to instill accountability and demand operational excellence.
Huntsman's stock has already gained 45% since Starboard's September 2021 involvement versus a flat S&P 500, implying further upside as operational execution closes the ~900bps EBITDA margin gap to the 24% primary-peer benchmark.
The three reasons
- 1
Huntsman underperformed the S&P 500 by 337% from IPO to Starboard's involvement
- 2
Board failed three Investor Day promises in a row (2014, 2016, 2018) without accountability
- 3
Board is insular with personal/financial ties to CEO, including >$750M Huntsman-family donations to a director's employer
Primary demands
- Elect Starboard's slate of four independent director nominees at the 2022 Annual Meeting
- Vote the BLUE proxy card
- Replace incumbent directors with conflicts/personal ties to CEO Peter Huntsman (Beckerle, Ferrari, Egan, Muñoz)
- Instill accountability and demand operational excellence to close the EBITDA-margin gap to peers
KPIs cited
Pattern membership
Precedents cited
- LyondellBasell under James Gallogly (stock outperformed S&P Chemicals/S&P 500 by 360%/382%)
- Rockwood Holdings IPO-to-Albemarle-sale with Susan Schnabel (outperformed S&P Chemicals/S&P 500 by 143%/223%)
- Celanese (Sandra Beach Lin's prior employer; ~2x Huntsman's 2021 EBITDA margin)
Composition what's on the 14 slides
Slide gallery ·
Notes
DEFAN14A proxy-fight letter to Huntsman stockholders accompanying Starboard's full 'Transforming Huntsman Corporation' deck (referenced but not included). Signed by Jeffrey C. Smith. Two especially memorable visual devices: (1) the 'Personal Friendships and Loyalties Among Huntsman Board Members' web diagram on p.7 mapping each director's tie to Peter Huntsman, and (2) the 'Fooled Shareholders ONCE / TWICE / THREE TIMES' broken-promises summary on p.13 capped with the 'definition of insanity' line. Uses peer-CEO 2021 earnings quotes (Celanese, Eastman, Dow) as a reverse contradiction device — not the target CEO contradicting himself, but peers proving Huntsman's 'best year ever' was a rising-tide effect. Layout is dense paragraph + chart hybrid (more letter than slide), heavy underline-bold emphasis. Stake not disclosed as percentage in this letter, only 'second largest stockholder'.