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A serious shareholder in Harley-Davidson is looking for important modifications to the corporate’s board, arguing CEO Jochen Zeitz and two different long-time members needs to be eliminated.
H Companions Administration stated Wednesday it was asking different Harley-Davidson shareholders to forged “withhold” votes on the upcoming shareholder assembly in Might when the re-election of Zeitz and two different board members, Thomas Linebarger and Sara Levinson, goes up for a vote.
The agency’s stake within the bike firm quantities to roughly 9.1%. One in every of its principals, Jared Doureville, was on Harley-Davidson’s board from February 2022 till earlier this month, when he resigned.
The company emblem for Harley Davidson Bikes is displayed at their retailer at Disney Springs at Walt Disney World on June 1, 2024 in Orlando, Florida. (Picture by Gary Hershorn/Getty Photographs / Getty Photographs)
Shareholders voting to “withhold” could be “sending a strong message to the Board that they are dissatisfied with the status quo and that meaningful change is required,” the funding agency stated in a submitting with the Securities and Trade Fee (SEC).
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In a publicly-available letter, H Companions advocated for Harley-Davidson’s board to “immediately remove” and change Zeitz with an interim CEO “until an external, permanent CEO is selected.”
“We believe an absentee CEO who has already announced his intention to retire should not be making decisions that could affect the long-term prospects of the business,” the funding agency stated. “We also believe that the current Board, which is tightly controlled by a small number of entrenched Board members, cannot be trusted to oversee crucial decisions, including CEO succession.”
Ticker Safety Final Change Change % HOG HARLEY-DAVIDSON INC. 22.45 +0.83
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Earlier this month, Harley-Davidson revealed it was within the midst of the method of discovering a brand new CEO to take over for Zeitz, who knowledgeable the board within the last quarter of final yr that he needed to retire.
H Companions says the bike firm skilled “poor performance” due to an “inability to course-correct” that it partly blamed on Zeitz and Linebarger.
A detailled view of a facet of a Harley-Davidson bike seen on Whyte Avenue in Edmonton, Alberta, Canada, on Sept. 10, 2023. (Artur Widak/NurPhoto through Getty Photographs / Getty Photographs)
It alleged the 2 “have not been fully transparent with the rest of the Board.” Zeitz, Linebarger and Levinson are “entrenched” and are “unable to hold each other accountable for poor performance,” it additional claimed.
H Companions stated in its SEC submitting that it was “deeply concerned that if the Board – as currently constituted – were to select the new permanent CEO, there will be a continuation of the Company’s current strategic direction and further destruction of significant shareholder value.”
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As of Wednesday, shares of Harley-Davidson have fallen over 24% for the reason that begin of the yr. Over the previous 12 months, they’ve posted a 42.7% decline.
“We believe it is imperative to find a leader who will repair the relationship with dealers, engage with riders, respect and strengthen the brand, improve the corporate culture, restore the physical presence of the Company at its historic Milwaukee headquarters, and return Harley-Davidson to greatness,” H Companions stated in its letter to shareholders.
FOX Enterprise reached out to Harley-Davidson for remark.
In early February, the corporate stated it generated $4.12 billion in income in 2024, a 14.9% decline year-over-year. Its annual internet earnings, in the meantime, fell to $455.36 million.
Harley-Davidson emblem is seen close to the shop in Krakow, Poland, on Jan. 24, 2024. (Jakub Porzycki/NurPhoto through Getty Photographs / Getty Photographs)
Zeitz stated on the time that Harley-Davidson “saw our performance being significantly impacted by the continued cyclical headwinds for discretionary products, including the high-interest rate environment affecting consumer confidence” in 2024.
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The corporate’s forecast for 2025 stated its income could be “flat, to down 5%.”
