An investor is making a plea to Berry Global Group to begin a strategic review of options including a sale or a private transaction. In a letter to the Berry board of directors, Ancora Holdings Group, which owns a 1% of the company, cited share price underperformance as the reason for the review, saying it believes the company could fetch as much as $100 per share. Shares of Berry are currently valued around $67. They have risen about 18% this year.

Ancora says that the stock price increases do not reflect the significant sales and earnings increases witnessed by Berry Global during the past five years. During this time, the company has made significant investments including the purchase of Clopay, a films maker, as well as investments in new nonwovens technologies around the world.

To remedy this, Ancora provided three options to Berry. The first is expanding its share buyback program to $1 billion—last week the board authorized a share buy back program worth $50 million. A second alternative is a sale-leaseback transaction whereby Berry would use its significant real estate holdings to raise cash to purchase shares. Lastly, Ancora believes a sale of the company would well serve the interest of shareholders by generating as much as $100 per share.
 
In response to these pleas, Berry issued a statement stating that its board and management team are committed to acting in the best interest of the company and its shareholders, and its regular engagement with investors supports our goal of enhancing value. “While it is the company’s policy not to comment on interactions with specific shareholders, it is important to note that members of Berry’s management team have held several discussions with representatives of Ancora over the past year to better understand their views,” the company said.

“We have continued to focus on driving consistent and sustainable long-term growth through strategic portfolio management and a flexible capital allocation strategy while also working diligently to offset the challenges created by Covid, inflation, labor and supply chains. We have successfully achieved our targets over the past several years and expect to drive our third consecutive year of positive organic growth in fiscal 2022.

“Additionally, the company  continues to build and maintain a world-class, low-cost, manufacturing base with an emphasis on investment in key growth markets and regions. Our robust, stable and dependable cash flow enables us to return capital to shareholders at favorable terms, while continuing to execute a flexible capital allocation strategy focused on additional opportunistic share repurchases, the paydown of debt and strategic acquisitions or value-enhancing strategic investments.”