True Value nation awaits results

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True Value nation awaits results

By Ken Clark - 04/19/2018
These are pivotal times for the True Value Company. The results of the membership’s vote on the Chicago-based co-op’s deal with ACON Investments are expected to be announced Friday, April 20.

As of press time, the signs pointed to a high probability of the deal passing, bringing an end to the long history of True Value as a co-op. The deal would also result in the sale of 70% of the company and the return to member shareholders of $229 million.

True Value’s headquarters released an early tally of the votes on April 13. In the tally, 85% of the members had voted for the proposal after 72% of the proxies had been counted. That announcement followed a 15-stop bus tour in which CEO John Hartmann led “town hall” discussions about the proposed deal. True Value described the meetings as successful and positive.

One dealer who attended the Manchester, N.H., meeting, Tom Cost Jr. of Killingworth (Conn.) True Value, described the attitude of the dealer attendees this way: “I think the mood has swung from very upset and frustrated, to mildly concerned and cautiously optimistic,” he told HBSDealer.

The ACON Investments deal is supported unanimously by the True Value board of directors.

But signs of a lingering opposition were readily apparent on a Facebook page called Concerned True Value Members. The site contains criticisms of the deal and the amount of time and information members were given to consider the deal. The page also shows organized efforts to convert voters from “yes” to “no” — including votes already cast. It’s unclear if those efforts swayed significant numbers of votes.

Particularly outspoken in opposition is Richard Reese, owner of True Value member Standard Plumbing in Sandy, Utah. Reese brought a lawsuit to block the deal to the Delaware Chancery Court. The suit failed to sink the deal, but did result in extending the voting a week, as management provided additional information related to the transaction.

Still the co-op management expressed confidence that the deal would go forward. A special meeting was slated for April 20, when the board of True Value will announce the results of the vote. “Based on the massive vote support, our plan remains to close the transaction on or around April 20th, following the special meeting,” John Hartmann wrote in a statement to members.