Over at our sister magazine Builder, the editors are covering an unfolding melodrama. PulteGroup, one of the biggest home building corporations in the United States, is having a near-hysterical spat over the future of its company and who should lead it. This past week, founder Bill Pulte, his grandson of the same name, and one of the company’s independent directors, James Grosfeld, met with current PulteGroup CEO Richard J. Dugas to pressure him to quit, immediately, and then began pressuring the company’s board of directors to drop Dugas when he refused. The senior Pulte, who stepped down as CEO and Chairman a half-dozen years ago but still is the company’s largest stockholder with about 8 percent of the company’s stock, then wrote an open letter to the board about his reasons for why Dugas’ “lack of performance and repeated bad decision-making has led me to conclude that the company needs new leadership.”
The board took offense to being pushed around by their former leader and issued an open letter of their own, partly to calm shareholders, that attempted to explain that “while we have significant respect for Mr. Pulte as the founder of PulteGroup, we believe his campaign is misguided and is not in the best interests of shareholders.” Also, they removed Mr. Gosfeld’s name from nomination to a director position at next year’s shareholders’ meeting—as punishment for meeting with the Pulte’s behind the board’s back and attempting to pressure Dugas to retire, which really angered the board—which was another move that rankled the elder Pulte as well.
Apparently, this is all about the board and Dugas’ decision to move the company headquarters to Altanta from Detroit. Maybe. We’re not entirely sure, but it’s messy.
Read the full opening salvo of this soap opera, as well as the full letters of Bill Pulte to the Pulte board and the board’s letter to the Pulte shareholders, at Builder.