Americold board backs Mark Patterson, rejects activist push

Americold Realty Trust’s board of directors has rejected an activist investor’s request to oust the chairman of the board.

Activist investor Sieve Capital publicly called for the removal of Mark Patterson over “problematic boardroom behavior” and short-sighted dealmaking. The investor cited Patterson’s tenure serving on the board of the office landlord Paramount Group, which is now under an Securities and Exchange Commission investigation.

On Wednesday, the cold storage REIT’s board announced in its annual proxy statement — which is sent out ahead of the firm’s annual shareholder meeting in May — that it will renominate Patterson as its chairman.

“The Nominating & Corporate Governance committee of the board met to discuss and reconfirmed its decision that Mr. Patterson is the right leader for the board, after undertaking a review of various matters raised in a recent shareholder letter to the board,” the firm said in its proxy.

Americold declined to comment.

Americold is the second-largest owner and operator of temperature-controlled warehouses, behind Lineage Logistics. It owns over 230 warehouses around the world, according to its website. But the firm has struggled with its high debt load and broader industry challenges, including lack of demand for cold storage. Americold’s stock has fallen about 70 percent since 2021.

The investor said in a press release late last month that it was particularly concerned with allegations about Patterson’s tenure on Paramount Group’s board. Sieve Capital cited The Real Deal’s reporting on loans Paramount’s CEO Albert Behler provided to Patterson’s robotic car garage company in late 2014. Patterson joined Paramount’s board in 2018. It is unclear whether the loans were ever paid back.

This isn’t the first time the firm has had to contend with a potential shakeup. Late last year, activist investor Ancora Global Holdings took a stake in Americold and pushed it to pursue strategic alternatives to sell parts of the business. Americold reached an agreement with Ancora to add two new board members.

Sieve Capital took a different approach and zeroed in on Patterson, who has served as a member of Americold’s board since 2018 and as chairman since 2019. He also serves as chair of the nominating and corporate governance committee.

The investment firm asked the board to remove Patterson of his chairman title or decline to nominate him for re-election at Americold’s annual shareholder meeting. The nomination by the board clears a major hurdle for Patterson.

Removing Patterson by shareholder vote could become less challenging if shareholders vote for a pending proposal where Americold’s board would amend the company’s governing documents to allow them to vote board of directors out with or without cause. Americold’s current rules only allow for director removal “for cause,” the shareholder claims.

“A bylaw that gives the right to remove a director during their term, with, or with without cause, if you think about it, creates greater accountability,” said Charles Elson, founding director of the John L. Weinberg Center for Corporate Governance at the University of Delaware.

Americold’s board is advising shareholders to vote against the proposal, claiming shareholders already have the right to vote against board members at the annual meeting with or without cause. But Americold’s board pushed against shareholders having the right to remove a director without cause between annual meetings.

“Adoption of this proposal could subject the company and the board to unfounded removal campaigns or attract investors who are not aligned with the interests of all stockholders,” the company said in its proxy statement.

But companies can overrule these shareholder votes, depending on their bylaws. In 2021, a majority of Paramount Group’s shareholders voted Patterson off the board. Paramoun’s board rejected his resignation and renominated him.