H&R Block CEO: Straight Shooter Aims at Hedge Fund

H&R Block Chairman and CEO Mark Ernst didn't mince words when describing activist hedge fund Breeden Partners' interest in gaining control of more than one-quarter of the company's board. Ernst squarely gave Breeden - a fund run by former U.S. Securities and Exchange Commission Chairman Richard Breeden - a piece of his mind in a letter to H&R Block shareholders, urging them not to support Breeden's slate of nominees:

It is unfortunate that a dissident hedge fund, Breeden Partners, has chosen to launch a distracting proxy contest. Breeden Partners owns less than 2% of our shares and has been a shareholder for less than a year yet seeks to replace more than 25% of your Board with its own handpicked slate.

In our view, Breeden Partners has put forth no new ideas to improve shareholder value. In fact, many of Breeden Partners’ proposed "changes" are identical to actions that your company announced and began implementing before Breeden Partners acquired a single share. We believe that Breeden Partners is advocating a sale or disposition of the Bank. Such an action would deprive H&R Block’s shareholders of the Bank’s significant potential and would threaten the enhancement of shareholder value.

Ask yourself whether Breeden Partners’ nominees – who have no new ideas other than the ill-advised sale of the Bank – are the right individuals to represent your best interests.

How's that for being direct?