Activist investor Ralph Whitworth on Monday made the first move in a planned proxy fight at California chip maker National Semiconductor Corp., where he now is the third-largest shareholder with a 7.2% stake.
Whitworth, in a regulatory filing, said he is seeking two board seats in order to have a bigger role in a bid to reverse losses the company has suffered and to revive its stock, which has plummeted 43% in the last year.
Whitworth's Relational Investors, which buys shares in poorly performing public companies and tries to turn them around, outlined its plans to the Securities and Exchange Commission. It now holds 13 million shares in the chip maker.
"We've been interested in the company for a couple of years, and we think it has a lot of upside," Whitworth said in an interview. "It has a ton of upside if they focus their capital allocation on their core business."
Whitworth has become a leading shareholder-rights activist, pushing for change at companies such as Apria Healthcare Group Inc., Waste Management Inc. and Mattel Inc. He led an effort last year at Tyco International Ltd. to oust directors who served under former Chief Executive Dennis Kozlowski.
In the SEC filing, Whitworth's company said it intends to nominate two candidates for election to the board of directors at the 2003 annual meeting.
The company's shares fell 88 cents, to $16.25 in New York Stock Exchange trading.
"To propel the company to take decisive action," Relational believes "stronger stewardship" is necessary, Whitworth's firm said in the filing.