Bill Pulte late Wednesday released a new letter to shareholders of PulteGroup, Inc. in which he said he would vote against the entire board of directors if company CEO Richard Dugas and lead director Jim Postl are not removed from their posts. Pulte is the company's largest shareholder, with an 8.8% stake. The company's annual meeting is scheduled for May 4. Following is the text of Bill Pulte's letter. At time of publication, the company had not issued a response.
As the largest shareholder and founder of PulteGroup Inc. (NYSE: PHM) ("PulteGroup" or the "Company"), I have grave concerns with PulteGroup's massive shareholder value destruction and inability to reverse the Company's chronic underperformance relative to peers and the broader market. CEO Richard Dugas has lost credibility with shareholders, and the Board of Directors of PulteGroup (the "Board") must replace him NOW. Even without adjusting for inflation, PulteGroup's revenue over the last 12 years has decreased from approximately $11.7 billion in 2004 to $5.98 billion in 2015 and PulteGroup lost over $530 million cumulatively in this period.
It is incumbent upon this Board, consistent with its responsibility to shareholders, to act immediately to put a world-class experienced CEO at the helm of OUR Company. Shareholders can no longer entrust the future of PulteGroup to the failed status quo. We cannot wait for another year to go by before effective, proven leader is in place. Despite my efforts, the Board has not accepted my attempt to professionally and privately resolve this significant issue in the best interests of all shareholders.
It is my strong conviction that Richard Dugas and Jim Postl must resign immediately from all their positions with the Company. Richard Dugas and Jim Postl worked together on the failed Centex deal where our shareholders lost over $1.46 billion. Messrs. Dugas and Postl have lost credibility with shareholders and cannot continue to serve in their positions as Chairman/CEO and Lead Director, respectively. They must be immediately replaced by direct shareholder representatives on the Board. To the extent Messrs. Dugas and Postl refuse to immediately resign from the Board and are not replaced by shareholder representatives, I will be voting AGAINST the entire Board at this year's upcoming annual meeting of shareholders.