Offshore drilling company Valaris has agreed to appoint Adam Weitzman to its Board. Weitzman is a partner at hedge fund Luminus which owns 18.7% of the outstanding shares of Valaris.
Weitzman, as part of Luminus, has over the past year criticized Valaris (formerly known as EnscoRowan), accusing the company of poor capital allocation decisions, value destructive M&A, and calling for significant board changes to reverse Valaris' "chronic underperformance."
Luminus in December said: "Valaris has dramatically underperformed peers over almost any time frame, and its shareholders have lost billions of dollars. Self-inflicted wounds and wasted opportunities are responsible for much of this. It is clear that shareholders deserve better representation in the boardroom, and that the capital markets will continue to lack confidence in Valaris’ Board until substantial change occurs."
In a statement on Monday, Valaris said the appointment of Weitzman was part of the Board's "comprehensive refreshment program."
The Board refreshment, according to Valaris, includes the addition of Georges Lambert and Frederick Arnold as new independent directors, augmenting the Board’s expertise in equity and debt capital markets and corporate governance; the announcement of three directors stepping down; a commitment to appoint an independent Chairman in 2020; and the formation of the Finance Committee.
Weitzman will also serve on the Finance Committee, to assist in the Board’s oversight of the Company’s capital structure and financial strategies, as well as the Compensation Committee.
Weitzman said: "Luminus applauds Valaris’ recent moves to augment the Board, and we are pleased to have reached a comprehensive agreement with Valaris.
"We look forward to contributing to the Company’s ongoing efforts to solidify its position as the leading offshore driller. We appreciate the Board’s responsiveness to our concerns, including the appointment of three new directors with impressive expertise in capital structure and capital markets, and the formation of the Finance Committee.
"I look forward to working closely with the entire Board to advance our shared goal of driving long-term shareholder value.”
With Weitzman's appointment, the Valaris Board of Directors will be comprised of 12 directors, 11 of whom will stand for re-election at the Company’s 2020 Annual General Meeting of Shareholders.