LSB Industries Bows To Activist Investor

LSB Industries, a maker of agricultural and mining chemicals, has named five new members to its board to avoid a proxy fight with activist investor Starboard Value. Two existing directors stepped aside to make way for Starboard-backed directors including Louis Massimo, a former Arch Chemicals executive. LSB says it now plans to separate its chemical business from its climate control products business and set up a master limited partnership for the chemical operations. In response to the news, credit rating agency Moody’s revised its outlook on the firm’s debt to negative from stable. Some of the director changes are positive, Moody’s says, but many directors on the 13-member board “do not have plant-level manufacturing experience.”