Alden's Heath Freeman to join board; Chris Bodine resigns
MEMPHIS, Tenn. — Later this month, Alden Global Capital LLC president and founding member Heath Freeman is slated to join the board of directors at Fred’s Inc.
Fred’s also said Monday that retail pharmacy veteran Christopher Bodine resigned from the board as of Aug. 11. Bodine, a longtime CVS executive, had joined Fred’s board in March.
Plans call for Freeman to begin as a director at the next scheduled meeting of the Fred’s board, expected to be held on or before Aug. 29
“I am eager to join the Fred’s board of directors and look forward to continuing the work we have been doing to support the management team,” Freeman said in a statement. “I am encouraged by the progress that we have made and continue to have confidence in the leadership team and future growth of the business. I look forward to working with the rest of the board to position Fred’s for long-term success.”
Fred’s said the addition of Freeman stems from an amended and restated cooperation agreement with Alden, dated Aug. 11, that extends the term of the companies’ agreement into 2019 and updates terms regarding their efforts to maximize value for Fred’s shareholders.
“Over the past several months, we have gotten to know Heath and the rest of the Alden team and have developed a healthy and productive relationship,” stated Fred’s chief executive officer and board member Michael Bloom. “With the benefit of Heath’s contributions as well as those of the entire board, Fred’s will be better-positioned for growth and generating positive free cash flow.”
Fred’s chairman Thomas Tashjian cited Freeman’s “deep retail, turnaround and financial expertise” in announcing his board appointment. “We believe that adding a shareholder perspective to the board as we continue to execute our health care transformation will accelerate value creation for all Fred’s shareholders,” Tashjian commented.
After Fred’s deal to buy at least 865 Rite Aid stores was cancelled upon the termination of Walgreens Boots Alliance’s planned acquisition of Rite Aid Corp., Bodine determined it was “the right time to step down from the board and focus his attention on other professional commitments,” according to Fred’s. The retailer had expected to leverage Bodine’s deep acquisition and integration expertise for incorporating the acquired Rite Aid stores.
“On behalf of the board, I want to thank Chris Bodine for his contribution to the company. We wish him much future success and happiness,” Tashjian stated.
Fred’s has been reconstituting its board since earlier this year. As part of the cooperation agreement between Alden Global and Fred’s, in late April the retailer named Steven Rossi, CEO of Digital First Media, and Timothy Barton, founder and former CEO of Freightquote.com, to its board as independent directors.
And in early March, Fred’s announced the appointment of four new board members: Bloom; Bodine; Linda Longo-Kazanova, chief human resources officer at Keurig Green Mountain Inc.; and former Safeway chief financial officer Peter Bocian. Fred’s also said former CEOs Jerry Shore and Michael Hayes and longtime director John Eisenman are retiring from the board and won’t stand for re-election at this year’s annual shareholders meeting.
Near the end of 2016, Fred’s announced the adoption of a poison pill plan after Alden became its single largest shareholder. Alden had filed a Form 13D with the Securities and Exchange Commission after having purchased 9.275 million shares of Fred’s common stock since Nov. 28, giving it a 24.8% stake in the company.
In the filing, Alden indicated that it believed Fred’s shares “are undervalued and represent and attractive investment opportunity” and planned to engage in discussions with Fred’s management and directors regarding the company’s operating performance, capital allocation, governance, board composition and strategic plans.