Houston Pension Sues Conagra over Pinnacle Acquisition

The Houston Municipal Employees Pension System has filed a securities class action lawsuit against Conagra Brands, claiming the food processing company knowingly misled investors about the benefits of its $10.9 billion Pinnacle Foods acquisition.

Chicago-based Conagra owns food brands such as Reddi-wip, Hunt’s, Healthy Choice, Slim Jim, and Orville Redenbacher’s. In June 2018, Conagra announced its acquisition of Pinnacle, in a cash and stock transaction valued at approximately $10.9 billion. Pinnacle Foods’ brands include Birds Eye, Duncan Hines, Vlasic, Wish-Bone, and Hungry-Man.

“The addition of Pinnacle Foods’ leading brands in the attractive frozen foods and snacks categories will create a tremendous opportunity for us,” said Conagra CEO Sean Connolly when the acquisition was announced.

Conagra said the combination of two companies’ portfolios “will serve as a catalyst to accelerate value creation for shareholders.” It also said that “the combination of two growing portfolios of iconic brands will serve as a catalyst to accelerate value creation for shareholders,” adding that the deal will “enhance Conagra Brands’ multi-year transformation plan and expand its presence and capabilities in its most strategic categories.”

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But in December, when Conagra reported its second-quarter results for fiscal 2019, the company said that net sales for the newly acquired Pinnacle were “below expectations due to weak performance across a range of significant brands.”

Operating profit for Pinnacle was $29 million, and adjusted operating profit was $57 million. Conagra said “this performance was below expectations” due to higher transportation costs and lower net sales.

According to the complaint, the announcement caused Conagra’s stock price to fall $4.81 per share, or nearly 17%, on Dec. 20 to $24.28, erasing more than $2.3 billion in market capitalization. The next trading day, Conagra’s stock declined another $2.13 per share, or 8.8%. In three trading sessions, Conagra stock tumbled $8.13 or 30%, to close at $20.96 on Dec. 24, 2018.

“Conagra and its management were aware or recklessly disregarded that the transaction would not result in anywhere near the sort of benefits that defendants had publicly represented,” said the complaint. “As a result of defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the company’s common stock, plaintiff and the other class members have suffered significant losses and damages.”

The lawsuit also names Connolly as a defendant, as well as CFO David Marberger. The complaint says that Connolly and Marberger publicly disseminated allegedly misleading documents, and had the ability and opportunity to prevent their issuance or correct them, but did not.

Molson Coors Hit with Class Action Lawsuit

Tags: Congra Brands, Houston Municipal Employees Pension System, Lawsuits, Pension

Hamilton Lane Expands Presence in North America, Hiring Mike Woollatt to Lead New Toronto Office

Hamilton Lane has opened an office in Toronto, Ontario. Mike Woollatt, who joined the firm as a principal on the co-investment and fund investment teams, will lead the office, which represents the firm’s 16^th location worldwide.

In 2018, Hamilton Lane was selected as one of the managers for the first stream of the Government of Canada’s Venture Capital Catalyst Initiative (VCCI). The Canadian government, through the Business Development Bank of Canada, created the VCCI to increase the availability of late-stage venture capital in the country. Part of the mandate will also focus on enhancing diversity and increasing the participation of women across the venture capital ecosystem. Woollatt will lead this program on behalf of Hamilton Lane.

“Canada is home both to sophisticated institutions and investors with a deep understanding of and appreciation for the private markets, as well as to a dynamic and exciting start-up community,” said Mario Giannini, chief executive officer of Hamilton Lane.

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State Street Appoints Francisco Aristeguieta to Lead Its International Business

State Street Corp. has appointed Francisco Aristeguieta to chief executive officer for its international business. Aristeguieta, who joins the company in July, will report to State Street President and CEO Ron O’Hanley and become a member of the company’s management committee.

Aristeguieta joins State Street from Citigroup, where he most recently served as CEO of its Asia business.

Initially based in Hong Kong, Aristeguieta will be responsible for all of State Street’s business activities outside of the US including driving strategy, stewarding client engagement, developing talent, pursuing growth opportunities, and increasing market share as well as deepening relationships with local government officials and regulators. He will work in partnership with State Street’s global business leaders to deliver solutions, expertise and insights to clients globally.

Insight Investment Appoints Jon Morgan as Head of Consultant Relations

Insight Investment announced that Jon Morgan has joined the firm as head of consultant relations, North America, a newly created role.

Morgan will help develop Insight’s consultant relationships as the firm responds to pension plan sponsors seeking strategies for their evolving liability and liquidity needs. He will also cover consultant-supported platforms and retail offerings.

Morgan joins from BlackRock, where he was most recently director, global consultant relations. He will be based in New York and report to Paul Hamilton, global head of consultant relations.

Stone Harbor Announces Chief Developed Market Economist Appointment

Stone Harbor Investment Partners LP announced the appointment of Seamus Smyth to the role of chief developed market economist. Based in the firm’s New York office, Smyth will report to Peter Wilby, managing partner and co-chief investment officer, and Jim Craige, co-CIO and head of emerging markets.

Previously, Smyth served eight years as a managing director and senior economist for Caxton Associates, where he was responsible for assessing the market implications of his economic views for the firm’s portfolio managers across rates, FX, equities, credit, and commodities.

Smyth holds a Pd.D. in Economics from Harvard University and a MSc in Statistics from Stanford University.

CANDRIAM Appoints Matthieu David Global Head of Financial Institutions and Partnerships

Building on its distribution expansion over the past few years and as part of its ambition to continue growing in this segment, CANDRIAM announced the appointment of Matthieu David as global head of financial institutions and partnerships, in addition to his current role as head of CANDRIAM’s Italian branch..

In this newly created role, David will coordinate the development of distribution activities for global financial institutions (GFI) in all countries in which CANDRIAM operates in order to increase its partnerships with leading global banks, insurance, and distribution companies that have a strong international footprint. David will continue to be responsible for CANDRIAM’s business development in Italy.

Tags: CANDRIAM, Hamilton Lane, Insight Investment, People Moves, State Street