Bath & Body Works adds director, Third Point backs off proxy fight

Bath & Body Works Inc on Monday named veteran financial executive and board member Thomas Kuhn as a new director, ending a potential board challenge from billionaire investor Daniel Loeb's hedge fund Third Point.

Kuhn, a lawyer and former banker who is currently a managing member of advisory and investment firm Doorbrook LLC , joins the board at the end of the week as its third newcomer and was recommended by Third Point, the company said in a statement.

The hedge fund, which owns a 6% stake in the home fragrance and personal care retailer, had been laying the groundwork for a proxy fight after pushing the company to make changes for months. The firm said it will not nominate directors this year after the company added Kuhn to the board.

"Tom's 35 year history as a respected financial and legal advisor, including working with consumer companies, will bring an important perspective to Bath & Body Works as it focuses on its key strategic initiatives to maximize shareholder value," Bath & Body Works board chair Sarah Nash said in a statement.

Kuhn joins The Hershey Company Chief Financial Officer Steve Voskuil and senior Conagra Brands executive Lucy Brady, who were both added in February, as the board's 13th member.

His arrival appears to have calmed the rising tensions between Loeb, who had pushed for a shareholder to join the board, and the company, which rejected Loeb's suggestion to add Third Point's former co-chief investment officer as a director.

For months, Loeb had criticized how Bath & Body Works was spending its capital and pressed for the board to add more industry expertise in consumer goods and better police excessive executive compensation.

Loeb took aim at Nash's $18 million package for stepping in as interim chief executive officer for several months in 2022 before the company hired Unilever veteran Gina Boswell as its new chief. But he also signaled good will toward the new CEO when he told his own investors last month, "We believe BBWI can change its equity story, improve its earnings power, and earn a more premium valuation."