Egon-Jones joined ISS and Glass Lewis in supporting all nine of WisdomTree’s (WT) board nominees. In the Glass Lewis report they stated “the board has made meaningful strides to empower its newer directors” and ISS said “there is no case for incremental change at this juncture”. WT defends the long-tenures of Anthony Bossone (15+ years), Win Neuger (10+ years) and Jonathan Steinberg (16+ years) stating it provides stability and preserves institutional knowledge. Given their C, C-, C Boardroom Alpha ratings and delivering 3%, -1%, and 3% annualized TSR (respectively), we’d suggest that these directors are riding a wave of recent performance that has made their tenures look better than it is. The better defense is that the board is actually actively refreshing with 6 new directors in just the last few years and that they expect this to continue. Though, ETFS Capital rightly points out that its activism has led to many of the improvements to the board including the refreshment and declassification.
Glass Lewis recommended Medallion (MFIN) shareholders vote for the board’s nominees and MFIN was fast to promote the fact by placing advertising via google and other online display advertising. We find any company’s argument that an activist is “self-serving” laughable given everyone involved at a company — the employees, the management, the investors (including activists) — are all trying too make money in their own self-serving interests. The reality of the MFIN situation is that the company’s performance is underwhelming, the board has long-serving directors with underwhelming track records (evidenced by lower Boardroom Alpha ratings and low TSRs over their tenures), and their governance has issues. From the outside perspective, it seems reasonable to ask whether the current MFIN board and executives are the right team to drive outperformance and materially increase shareholder value.
F9 Investments continued to hammer home their case that the LL Flooring (LL) management team has made major strategic mistakes (e.g. dropping the well-known Lumber Liquidator brand name) resulting in the destruction of shareholder value with the stock dropping over 93% in the last three years. F9 Investments also cites concerns voiced by other large LL Flooring shareholders including Donovan S. Royal and Howard Jonas on behalf of a consortium of shareholders. As the reader can see from the LL stock price graph to the right, it’s been a disastrous 3-year period with the stock plummeting and rife with red flags. Those red flags include the recent going concern risk (ie the company may go out of business) cited by the company’s auditors.
Latest Activism and Governance research from Boardroom Alpha:
Nominating four directors: Michael Cricenti, Jennifer M. Hill, Betsy L. McCoy and Steven J. Pully
Proposal to remove “overreaching” advance notice bylaw provision
Proposal to urge the Board to amend the Bylaws to preclude any current or former employee, director, officer, or control person of the Corporation or Ashford (as defined in the Proxy Statement) and Ashford’s affiliates from serving as the Corporation’s chairman of the Board
Proposal to require the Board to disclose all extraordinary transaction proposals made by stockholders, affiliates and third parties during the two most recently completed calendar years and the terms of those proposed transactions
Proposal to require the Board to disclose all compensation paid by the Corporation to members of the Bennett family, The Dallas Express and employees, directors or agents of The Dallas Express, including Louis Darrouzet
AREX Capital owns 4.8% of the shares of Enhabit (EHAB)
AREX Capital believes EHAB strategic review should have resulted in a sale of the company.
AREX Capital believes EHAB board lacks “Health and Hospice” expertise
AREX nominating 7 directors to the board: Megan Ambers, James T. Corcoran, Maxine Hochhauser, Mark W. Ohlendorf, Anna-Gene O’Neal, Dr. Gregory S. Sheff, Juan Vallarino.
Nominating two directors to the board: Brad Favreau and Daniel Silvers
Engine Capital believes that MRC is significantly underperforming, especially relative to DNOW Inc.
Engine Capital believes that MRC’s inability to settle it’s ongoing dispute with Cornell Capital is preventing MRC from optimizing capital structure
Engine Capital believes that MRC’s M&A strategy is flawed and that CEO Rob Saltiel does not have a successful track record in acquisitions or integrations
Shah Capital Management intends to vote against Novavax directors Richard H. Douglas, Margaret G. McGlynn, and David Mott
Shah Capital Management believes that Novavax is undervalued and continues to suffer from poor profitability, despite the substantial value to be unlocked in the Company’s Matrix-M adjuvant platform and non-mRNA protein vaccine portfolio.
Shah Capital Management met with management and the board multiple times over the course of 2023 and 2024, but believes Novavax has been unresponsive to their suggestions.
Mismanagement and Poor Performance: The letter claims that Salarius Pharmaceuticals is mismanaged by its current Board and management, leading to a significant decline in shareholder value and underperformance of the company.
Compensation Issues: The letter criticizes the Board for failing to establish a culture of accountability, highlighting excessive and poorly justified salary increases and stock option grants to executives despite the company’s poor performance and declining stock price.
Misaligned Incentives: The author points out that the Board members and executives hold a minimal percentage of the company’s shares and have not made open market purchases, indicating a lack of alignment with shareholder interests.
Questionable Decisions and Lack of Transparency: The letter accuses the Board of engaging in “curious compensation practices” and “disclosure diffusion,” making it difficult for shareholders to get a clear understanding of executive compensation and undermining informed voting.
Call for Change: The activist argues for the need for new Board members with fresh perspectives and better alignment with shareholder interests, expressing a lack of confidence in the current Board’s ability to improve the company’s performance and accountability.
Clayton Partners, JSCC Family Trust, and Jason Stankowski are contesting the proxy
Clayton is nominating Jason Stankowski and Clara Nagy McBane to the board
Clayton believes the company is not being managed to the benefit of its shareholders — believes “Spruce is, at worst, a break-even business and has significant opportunities for positive cash flow generation going forward”
Clayton disagrees with the company not buying back any stock despite trading at a 25% discount to the estimated value of the stock
ETFS Capital owns approximately 10% of Wisdom Tree (WT) and believes “immediate action to unlock significant value for all stockholders and halt further value destruction.”
Puts a focus on WT’s strategy of transitioning to a decentralized finance (DeFi) business and believes that it resulted in poor management of the core, profitable ETF business.
Believes the company’s true value lies in its ETF business, which suffers from poor profitability despite record assets under management.
Believes its attempts to be collaborative have been met with ” a public and bafflingly hostile response.”
On May 22, 2024 Kimmeridge withdrew its nominees in light of the Silverbow’s pending sale to Crescent Energy
Ben Dell, Co-Founder and Managing Partner of Kimmeridge, said, “While we are disappointed that SilverBow’s Board does not appear to have run a comprehensive sales process, our campaign was always underpinned by a strong belief that consolidation is in the best interests of shareholders.”
SilverBow Resources has rejected multiple offers, over the past two years, by Kimmeridge Energy Management — the latest offer valued SBW at $2.1 billion
SilverBow believes the offer substantially undervalues the company
Kimmeridge holds a 12.9% stake in SilverBow, along with Riposte Capital, the second-largest shareholder
Kimmeridge is also attempting to get 3 directors onto the board
SilverBow has rejected the three nominees citing concerns over their independence and representation of all shareholders’ interests
May 21st meeting was adjourned to “allow additional time for recent developments to be considered by shareholders”
Shareholder meeting will reconvene on May 29th, 2024
All Genco directors were elected with over 85% support
Say-on-Pay received 87% support
Genco said: “We believe that the decisive results of this meeting reflect our shareholders’ confidence in Genco’s Board of Directors and management team and our Comprehensive Value Strategy.”
GK Investor / George Economou has provided notice that it is nominating 2 directors: Randee Day and Robert M. Pons
George Economou: “As a significant Genco shareholder, I strongly believe in the Company’s potential to deliver improved value for shareholders. Both Randee and Robert have highly relevant backgrounds that would, in my view, be additive in the boardroom and would help address Genco’s lagging performance. I believe the entire Board would benefit from their fresh perspectives and collective knowledge of the maritime and technology sectors and experience in finance, corporate strategy and governance.”
Crown Castle (CCI) announced via press release that all 12 of the company’s nominees were elected to the the board.
There was no mention of vote counts, so we’ll need to wait for the official 8-K 5.07 to be filed.
Crown Castle Inc. is facing a proxy battle initiated by its co-founder, Ted B. Miller, and his investment vehicle.
Ted B. Miller criticized the Board’s actions, asserting that they wasted shareholder resources during a period of significant value destruction.
Boots Capital called for immediate change, advocating for new independent directors and a fresh start.
Miller points to Crown Castle’s board rewriting its cooperation agreement with Elliott Management as an admission that the initial process was tainted.
The rewritten agreement still did not require Elliott to maintain an equity position in the company.
Miller has filed a lawsuit to invalidate Crown Castle’s cooperation agreement with Elliott.
SUAC and FTII Shareholders Approve Extensions. APXI Extension Vote Set. BHAC and THCP Investor Decks. GLAC Non-Binding LOI.
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