Co., whose shareholders voted last month in favor of a
nonbinding proposal to spin off its steel business from its
other business units, has formed a strategy committee to
evaluate the possibility and to review the companys
corporate governance and capital-allocation strategy.
About 53 percent of
the votes cast at the annual meeting May 17representing
about 47 percent of the companys outstanding
shareswere in favor of a split, the Canton, Ohio-based
company had reported (
amm.com, May 7).
Two investor groups,
West Sacramento, Calif.-based California State Teachers
Retirement System and San Diego-based Relational Investors LLC,
began their campaign to "unlock value" at Timken by separating
its steel and bearings businesses last year.
Although the board of
directors was not bound by the results of the vote, it formed
an evaluation committee consisting of all independent and
non-Timken family board members, with lead director Joseph W.
Ralston serving as chairman. The committee has retained New
York-based Goldman Sachs Group Inc. to assist in its
"The board values the
feedback we received from our shareholders through the course
of the proxy process as well as at our recent annual meeting,"
Ralston said in a June 10 statement. "The committee, with the
aid of outside advisors, is carefully evaluating options
related to corporate structure as well as shareholder input on
corporate governance and capital allocation."
Timken said it will
report on the results of the committees evaluation by the
end of the third quarter.
After the proposal
received support from a majority of shareholders, Relational
Investors principal Ralph Whitworth said Timkens
"conglomerate structure ... has proven to be an ongoing
impediment (and) must be eliminated."