March 29, 2000
The Wall Street Journal/California
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Dissidents Nominate
Veteran Democrats
For Maxxam Board
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By Mitchel Benson
SACRAMENTO -- The Oakland-based Rose Foundation for
Communities and the Environment has joined with the
United Steelworkers for the second consecutive year to
nominate two veteran Democratic politicians to run as
so-called dissident directors at Maxxam Inc.'s
shareholders meeting on May 24.
Returning this year is Abner Mikva, a former Illinois
congressman, federal appellate judge and onetime counsel
to President Clinton. The coalition has also nominated
former U.S. Sen. Paul Simon of Illinois (last year's
choice was former U.S. Sen. Howard Metzenbaum of Ohio).
But the financial heavyweight that endorsed the
coalition's unsuccessful slate last year -- the
California Public Employees Retirement System, which
owns about 3% of Maxxam's common stock -- is withholding
any action because Maxxam has said it will name its own
independent nominees next month.
Coalition leaders, who said they couldn't wait for
Houston-based Maxxam to act, say they're concerned that
Maxxam's stock has lost more than 50 percent of its value since
last summer. In addition, they're concerned about the
redwood logging practices of Maxxam's subsidiary,
Pacific Lumber Co., Scotia, and the financial health and
operations of another Maxxam subsidiary, Houston-based
Kaiser Aluminum Corp., which accounted for 88 percent of
Maxxam's revenue last year.
"Given the current stock price, it's hard for me to see
how the company's current policies and current
leadership are serving the best interests of Maxxam's
common shareholders," says Rose Foundation President
Jill Ratner.
But Maxxam spokesman Joshua Reiss says the company will
oppose the slate. Messrs. Mikva and Simon "are beholden
to special interests" and aren't truly independent
voices," says Mr. Reiss. "These are guys who during
their tenures in Congress...repeatedly voted against the
interests of aluminum companies and forest-products
companies."
What's more, Mr. Reiss says, Mr. Simon "was the
recipient of tens of thousands of dollars" in campaign
contributions from the United Steelworkers.
Mr. Simon responds that the steelworkers provided only
"a tiny fraction" of his campaign war chest. And, as
someone who cast a decidedly anti-labor vote as a
senator for the North American Free Trade Agreement, he
says, "I am willing to stand up to labor or anybody
else. If I am on the board, my obligation is to the
shareholders."
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