Jeffrey Smith’s Starboard Value LP has entered into a letter agreement with Wausau Paper Corp. (NYSE:WPP), a new amended filing showed. Pursuant to the agreement, Gavin T. Molinelli, managing director of Starboard Value LP will serve as an observer of the board of directors of Wausau Paper Corp. (NYSE:WPP) until the earlier of the 2014 annual meeting of shareholders or September 30, 2014.
Starboard currently owns 7.50 million shares of the company, amassing 15.1% of the common stock outstanding. In February, Starboard sent a letter to Wausau Paper Corp. (NYSE:WPP) to express its disappointment after the company reported negative earnings for the fourth quarter of 2013. The fund stated the company has failed to take advantage of the opportunities that could increase its value.
In another letter sent to the board of Wausau Paper Corp. (NYSE:WPP) in January, Starboard asked for a change in the board of the company. The fund intended to elect three new members to the board, two of them being industry experts and one a direct representative of the shareholders, in contrast to the members nominated by the company who had no relevant operating experience.
Wausau Paper Corp. (NYSE:WPP), headquartered in Mosinee, Wisconsin, is engaged in producing and marketing a complete line of away-from-home towel and tissue products. Recently, Henry C. Newell has stepped down as CEO of the company, effective immediately, according to a statement. In addition, the company said that Thomas J. Howatt, non-executive chairman, will retire from the board in advance of the company’s 2014 annual meeting of shareholders.
For the full-year 2014, the company has reaffirmed its guidance of 6% annual case shipment growth, with the EBITDA in fourth quarter of 2014 in a range of $20 to $24 million and EBITDA margins of 20% and 24%. The company anticipates 2014 fourth-quarter net earnings from continuing operations of $0.10 to $0.13 per share.