Ned Sherwood wants people to know that he is not an "activist investor" — despite his public criticism of Greek shipowner Angeliki Frangou.
He is not looking for a pile of money to walk away from his investment in her Navios Maritime Partners. Rather, the finance veteran of more than 40 years just wants something he said Frangou has been unwilling to give him: a chat.
"I'm not an activist investor and I don't want a payoff," Sherwood told TradeWinds.
"I'm basically a solid value investor. And just like a Warren Buffett or anyone else in that position, I'd like to be partners with Angeliki. If she wants to be partners with any of the [limited partners] in Navios. And right now it appears she doesn't.
Sherwood, an investor based in Connecticut and Florida, spoke with TradeWinds after twice challenging Frangou in open letters to the Navios Partners board, accusing her of "illogical" actions "counter to any sound business principles".
"I would hope Angeliki would agree to talk with me and I could be helpful to her," he said. "In the meantime, I'm hoping that moral suasion will help lead her to doing some or all of what we're suggesting for her own good. It's not like we're some big, bad guys wanting something that's good for us and bad for her."
Frangou previously has told TradeWinds that she will not publicly comment on critiques made by an individual investor.
But the company issued a new statement in response to Sherwood's latest broadside through New York-based spokeswoman Laura Yagerman, senior vice president for corporate communications.
She said Navios Partners values its relationship with shareholders and is happy to "engage in constructive dialogue".
"Although we are disappointed that Mr Sherwood chose to issue public press releases before engaging in any discussion with us, we have reached out to his organisation to coordinate a conversation about our plans to continue to build value for [him] and our other equity holders," Yagerman said.
Since 2018, Sherwood has accumulated more than 1.1m shares in Navios Partners — currently good for 4.4% of the company. He had held 5.8% before recent shares issuances by the owner, but has not sold any shares.
The investor reached out to TradeWinds in what he said was an attempt to clarify his status and explain why he has publicly prodded Frangou — effectively the general partner in the company — to work more closely with limited partners (LPs) such as himself.
And although Sherwood has been through the corporate wars over the years — winning proxy fights and becoming the first investor to oust management of a Chinese company — he also makes clear that this is not his intended end game in the Navios scenario.
"I don't see any way to unseat her through a proxy contest," Sherwood said. "You would need to get two-thirds of the LPs voting that way, and in this case it doesn't seem like there would be any likelihood of success."
Sherwood also stressed that he does not fancy himself as a shipping expert — Navios Partners is his first foray into the space — but merely a financial expert with decades of experience advising management teams in other industries.
The graduate of the University of Pennsylvania's prestigious Wharton School of Business entered the private-equity world in the late 1970s through companies that were then better known as leveraged buyout firms before he founded ZS Fund LP in 1985.
'Shipping in her blood'
He said ZS Fund has a track record of 40% compound returns since, but Sherwood engaged in the Navios investment not for ZS Fund, but for his own account.
"Angeliki obviously has shipping in her blood," he said. "She's been involved her whole life and her family goes back generations. I don't even pretend to know the shipping industry. I can learn enough in an industry to be dangerous, but I never try to overrule a pro."
Sherwood was attracted to Navios Partners because he saw an undervalued company. Unfortunately, he said it remains undervalued today because of what he called "the Angeliki discount".
Equity analyst Randy Giveans of investment bank Jefferies also sees Navios Partners trading at a steep discount to net asset value: roughly 50% compared with a peer average of 85% to 90%, according to a recent report.