Target to shareholders: Take the blue pill
Target is hosting its annual shareholder meeting today and faces a pretty contentious fight from a major shareholder. William Ackman wants to shake things up and has nominated five independent candidates to the board of directors, including himself.
Ackman isn't exactly an everyman. He runs Pershing Square Capital Management, a hedge fund that controls nearly 8% of Target's stock. Ackman is pushing for change in the retailer's merchandising strategy to include more low priced items and food, but if successful today, he could change the size, composition and oversight of the board of directors.
I love activist shareholders. If there had been more of them or they were louder, we might have avoided some of the problems plaguing the economy today. Unfortunately the odds are stacked pretty high against Ackman and his ilk.
First off, Target management has not engaged in the conversation at all, beyond telling shareholders to "vote the white card." Meaning, they should just cast their votes for whomever the current board recommends. That's akin to saying, "don't worry your pretty little heads about anything. Just do as we tell you."