If Bill Ackman knows how to do anything, he knows how to generate unfavorable press coverage. As an activist hedge fund manager, he’s hardly unusual in this regard; dragging a company’s name through the mud is sort of the name of that game. And so it is with the Pershing Square Capital Management’s chief’s latest adversary, Automatic Data Processing. Now, Ackman’s plans, such as they are, for ADP haven’t impressed much, and neither have the members of his dissident slate of director candidates, one of whom happens to be Bill Ackman. So Ackman warns that he’s moving on to his next strategy, which is an all-out smear campaign.
ADP said Ackman told company that once he nominated directors, he would be committed to a proxy fight and would not settle. And, the ADP disclosure said, Ackman added that if he were engaged in a proxy fight, he would "use his ability to generate media coverage to damage both Mr. Rodriguez and the company and that would be bad for the company's clients, employees and stockholders."
To be sure, Ackman’s nascent battle with ADP has generated media coverage. And it has been awfully negative. Unfortunately and all-too-familiarly for Ackman, however, that negativity has been pretty laser-focused on him. So he’s going to go ahead and walk those threats back and look forward to a cheery, air-clearing meeting at which he’s sure by force of his intellect and personality, ADP CEO Carlos Rodriguez and the rest of its board will see the error of their ways, immediately give Ackman a seat amongst their number and enact his “transformational plan” to double its stock price.
"As often happens in these types of situations, it appears that there have been misunderstandings over the past few weeks which unfortunately have clouded what should have been a productive relationship from the start," Ackman said in his letter.
"To that end, we look forward to the opportunity to meet with you and the rest of the board on Tuesday, September 5th and engaging in a productive and substantive discussion," he concluded.