Building Materials Holding Corp. (BMHC) has been placed on a negative watch by Standard & Poor’s rating services, a possible precursor to a lowered rating over the next few months. S&P took the action following last week’s SEC filing from Chapman Capital, a BMHC shareholder that is seeking to oust chairman and CEO Robert Mellor.
“This change could lead to unexpected changes in business strategies that neither support credit quality nor stay within our expectations at the current ratings,” said S&P analyst Andy Sookram in a prepared statement.
The credit watch also made reference to “an expectation that this downturn will last longer than previously expected.”
Chapman Capital, based in Los Angeles, owns a 9 percent stake in BMHC, according to the firm. The managing member, Robert Chapman, has filed numerous SEC documents calling for changes at BMHC, the most recent being the replacement of Mellor by Stan Wilson, president of the BMC West division.
BMHC's 2006 direct sales to professional customers were $2.8 billion. The company's total sales in 2006 were $3.2 billion.