It’s a good thing that Newell Brands Inc. was able to end its proxy fight with Starboard Value LP in April, concluding months of harsh public criticism and distraction for the corporate parent of brands such as Yankee Candle and Coleman coolers.
But I suspect the sense of relief for CEO Mike Polk was only temporary because now he has to prove the transformation plan he fought to preserve is going to work.
Fortunately for Polk, he just took an important step in that direction. Newell announced on Friday that it had agreed to sell the Waddington Group, a packaging products manufacturer, to Novolex Holdings LLC for $2.3 billion.
The deal shouldn’t surprise investors. When Newell pledged in January to explore strategic options for some of its brands in an effort to become a significantly smaller, more efficient company, Waddington was on the list of those it was looking to unload.
And more broadly, the company has said it is particularly focused on shedding some of its more industrial and commercial brands, and Waddington fits that description.
It matters that Polk was able to start delivering on his plans. If he hadn’t come to investors with this M&A red meat Friday morning, I suspect it would have set off some serious concerns about the turnaround strategy. That would be a loss of confidence that Newell can ill afford. Investors had been souring on Newell well before it announced in January that it planned to drastically slash its manufacturing base and customer…