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Billionaire investor Daniel Loeb’s Third Point LLC is launching a proxy fight to remove the entire sitting board at Campbell Soup Co., charging the American food company with being in a “mess” and faulting the board for failing to take corrective action.

Mr. Loeb’s US$18-billion hedge fund, which owns a 5.65-per-cent stake, is nominating 12 people, according to a letter sent to Campbell's board on Friday. The slate includes executives from the hedge fund, a descendant of the founder of Campbell soup, and experts in marketing, operations, and transactions.

Mr. Loeb’s move comes one week after Campbell unveiled a strategic review, deciding to sell two businesses.

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Previously, Third Point has said that, under the current management team and board, the company should put its entire business up for sale. But its position has shifted somewhat to suggest that other outcomes might be possible with a new board.

Investors had expected Mr. Loeb to ask for board seats, but pushing to throw out all sitting directors is a rare step in the industry and especially for Third Point, which usually asks for only a few board seats.

Third Point said it took the step because the board failed to “understand the depth of the Company’s crisis” and failed to take “bold action.”

Mr. Loeb said the board stood by as the company went on an acquisition spree and said US$7-billion in value was destroyed since 2016. Campbell’s stock price is now 20 per cent lower than it was 20 years ago, Mr. Loeb said, criticizing the board for failing to have a CEO succession plan in place. This year the stock price has lost 17 per cent.

“At this point, it would be simply reckless to leave the Board that caused this mess in charge of fixing it,” Mr. Loeb said.

Campbell said in a written statement in response to Mr. Loeb’s move that the board determined the best way forward is “to optimize the company’s portfolio, divest certain businesses and pay down debt.” It also said it was open to evaluating all strategic options in the future.

FAMILY SOUP

As Third Point seeks to remake the board, it has allied itself with George Strawbridge, a grandchild of chemist John Dorrance who invented condensed soup and ran the company nearly a century ago. Mr. Strawbridge previously sat on the Campbell’s board and may now be called on to convince the family, which jointly owns roughly 41 per cent of the shares, that updating is needed at the company.

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The Third Point slate also includes William Toler, former chief executive of Hostess Brands, and Munib Islam, a partner at Third Point. And it includes three women: lawyer Franci Blassberg, marketing executive Sarah Hofstetter and Bozoma Saint John, who had been chief brand officer at Uber.

However, Mr. Loeb could face an uphill struggle for control of Campbell Soup, given the large stake owned by Dorrance descendants and the fact two grandchildren and a great grandchild currently sit on the board.

Third Point last ran a proxy contest four years ago and reached a settlement for three seats on the board of auction house Sotheby’s.

Unseating an entire board is rare but it was accomplished when hedge fund Starboard Value replaced all directors at Darden Restaurants in 2014.

Third Point has hired Okapi Partners as its proxy solicitor, which also worked for Starboard on Darden.

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