Media Center

11/25/2020

Aryzta's Biggest Shareholder Tells Board It Will Not Accept Elliott Offer

Independence Bulletin Journal (11/25/20) Donnelly, Ellie

Elliott Management recently offered to buy Aryzta (ARZTY) in a deal that would value the company at around €734 million. In a letter to Aryzta's board, the company's biggest shareholder Cobas Asset Management, which helped oust its former management, said the offer “significantly undervalues the company.” “Cobas AM has no intention, whatsoever, to tender its shares at such a price,” the letter said in response to the emergence of bid plans from Elliott. Cobas, which owns almost 10% of Aryzta, added that it is urging the board of Aryzta to continue to be impartial and “not assist Elliott Advisors with their financing arrangements.” The investors say they expect the board of Aryzta to continue the mandate to “deleverage and simplify the company.” Elliott thinks it can have a firm offer for Aryzta on the table in time to be put to a shareholder vote on Dec. 15. Refinancing arrangements for Aryzta’s existing debt are at “a very advanced stage,” Elliott said earlier this week. Despite outspoken opposition from Aryzta’s new leadership, Elliott has indicated it will not launch a hostile offer for the company, as this would trigger banking covenants on loans.

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11/25/2020

Top Quadient Shareholder Backs Possible Sale of Unit - Letter

Reuters (11/25/20) Jessop, Simon; Barzic, Gwénaëlle

Teleios Capital Partners wants Quadient (NPACY) to consider a potential bid by private equity firm Accel-KKR for a part of the company, according to a letter seen by Reuters. The biggest investor in Quadient, Teleios owns more than 15% of the French software firm. Accel-KKR is looking to buy the business unit for more than 350 million euros. In the letter, Teleios said it was "seriously concerned" that such an offer "which we believe could create substantial value for all shareholders" would not be given a fair hearing by the board. The investor called the company's current strategy "misguided," citing recent decisions involving restructuring, the dividend, and mergers and acquisitions. Teleios said engaging Quadient is in the best interest of all stakeholders and that it would "exercise all rights available" to hold the board accountable should it fail to act.

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11/25/2020

Leaf Group Gets a 'Thumbs Up'

Seeking Alpha (11/25/20) Jensen, Bret

Osmium Capital purchased 500,000 shares of Leaf Group (LEAF) on the same day as its preliminary third quarter announcement. An investor group led by Osmium has launched a proxy battle at the company and has called for a strategic review of its operations. Osmium and its allies control more than 40% of shares outstanding. The strategic review concluded in May that not selling the company was best for maximizing shareholder value. Leaf's CFO resigned after the announcement, and Osmium called for the resignation of CEO Sean Moriarty. Since April, four of nine members on Leaf's board have resigned. Osmium says Leaf's assets are underperforming and undervalued. It remains to be seen whether Osmium's move to control more than 50% of shares was initiated to force out Moriarty or because of Leaf's excellent performance in recent quarters.

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11/24/2020

CoreLogic Responds to Fresh Challenge From Cannae, Senator

Reuters (11/24/20) Bera, Ayanti

CoreLogic (CLGX) officials on Tuesday said they expect to receive definitive proposals for the company early next year. Investors Cannae Holdings and Senator Investment Group have been pushing for a sale by offering to buy the company for $7 billion. However, the shareholders abandoned the move after CoreLogic launched the sale process. The U.S. property data and analytics provider said its board supports the sale process. On Monday, Cannae and Senator asked CoreLogic to set a record date that will determine the eligibility of shareholders entitled to vote on a slate of six new board directors. Their request comes a week after they picked up three board seats at CoreLogic.

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11/24/2020

Sian Capital Criticizes Pharma Company Opko Health for Dragging Its Feet on a Potential Covid-19 Treatment

Business Insider (11/24/20) Saacks, Bradley

Sian Capital is calling on Opko Health (OPK) to rapidly distribute its Rayaldee drug, which has been touted as a way to treat Covid-19. Sian said Opko has not moved to distribute Rayaldee in the U.S. or Europe since it hit the Food and Drug Administration's marks this summer. The criticism comes a few weeks after Sian called for a possible sale of Opko, in which it holds a 3% stake. "As a substantial investor in Opko, we believe the Board has not only a fiduciary duty, but a humanitarian duty to distribute Rayaldee to those in need," wrote Sian's Anish Monga in a recent letter to the company's board. "There is no reason that so many Americans should continue dying without having the opportunity to access potential curative drugs."

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11/24/2020

Germany Will Require Companies to Put Women Executives on Their Boards

CNN (11/24/20) Ziady, Hanna

Germany's coalition government has agreed to a mandatory quota for women on the boards of listed companies, in what is being viewed as a historic breakthrough for Europe's largest economy. According to a statement by Germany's ministry for family affairs, senior citizens, women, and youth, listed companies with management boards of more than three executives will be required to appoint at least one woman to the C-suite moving forward. "We are putting an end to women-free boardrooms at large companies," declared Franziska Giffey, the minister for women and families. However, some business lobby groups pushed back on the decision. The Federation of German Industries (BDI), in particular, said it supports efforts to encourage the appointment of women to leadership positions. However, it wrote in an official statement, a fixed board quota is "a major intervention in entrepreneurial freedom." A final decision on this new measure is expected next week.

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11/24/2020

Biglari Capital Loses Fifth Proxy Battle With Cracker Barrel

Nation's Restaurant News (11/24/20) Fantozzi, Joanna

Sardar Biglari of Biglari Capital Group has lost his fifth waged proxy battle—and fourth attempt to gain a board seat—against Cracker Barrel Old Country Store Inc. (CBRL). The company recently approved all 10 of its nominated board members by a wide margin. Biglari, who Cracker Barrel termed an "historically dissident shareholder," had tried to nominate his own ally to the board, The Briad Group President and co-CEO Raymond Barbrick, back in September. Cracker Barrel countered by nominating former Walmart executive Gisel Ruiz to its board. Ruiz was one of the 10 directors approved. Biglari Capital Group, whose holdings represent Cracker Barrel's largest shareholder group, has long criticized Cracker Barrel's leadership and investment decisions.

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11/24/2020

Auto Service Company Monro Pushed by Ides to Make Changes

Reuters (11/24/20) Herbst-Bayliss, Svea

Sources say hedge fund Ides Capital is pressuring U.S. car service and tire center operator Monro (MNRO) to make changes, including environmental, social, and governance (ESG) improvements such as diversifying its workforce and board. Ides claims a diversity shortfall and broader ESG issues have prevented Monro from fulfilling its potential. The hedge fund reiterated its concerns to the company's board as recently as October. Monro is currently valued at $1.5 billion, and its stock rose 7.83% on Nov. 24 to close at $48.35. The company said it engages regularly with investors and appreciates their comments. "Promoting a diverse organization is a key pillar of our company and a priority for our Board of Directors," declared a Monro spokeswoman. "Our diversity and inclusion efforts are ongoing and will be an important factor as we formalize our environmental, social, and governance program to better inform our shareholders of our initiatives." Monro's board had been primarily male and white, and had served an average of 17 years, compared to the Standard & Poor's 500 companies' average of 11 years. In August Monro added its first-ever racially diverse director, and its board currently includes two female directors. Ides has requested that Monro publicly disclose its diversity statistics and ESG metrics. Monro's stock price has fallen 43% since January, and in August CEO Brett Ponton departed to become CEO of ServiceMaster Co. The board has been seeking his replacement since then. Ides' lobbying at Monro dovetails with a wave of consolidation in the auto parts and repair sector. Earlier this year Meritage (MTH) acquired Les Schwab Tire Centers, and Golden Gate Capital purchased Express Oil in 2017 and Mavis in 2018. Mavis also announced its planned acquisition of Town Fair Tire Centers last week. Monro is one of the last sizable firms in the industry, and the sources said Ides has encouraged Monro to consider all alternatives to maximize shareholder value while also searching for a new CEO.

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11/24/2020

Aryzta’s €1.2 Billion of Loans Prevent Hostile Elliott Bid

Irish Times (11/24/20) Brennan, Joe

Elliott Management is not in a position to mount a hostile bid for Aryzta (ARZTY), because it needs the group’s board to help line up a deal on its €1.2 billion in debt. News of the €735 million bid emerged on Friday. Sources say the board is unlikely to pursue a deal with Elliott as its members including Chairman Urs Jordi, who was nominated by activist investors a few months ago and appointed via shareholder vote, oppose the deal. The board is more likely to press ahead with the sale of non-core assets to lower debt and simplify the embattled business. While there has been speculation that Elliott is looking to secure a write-down on what banks are owed as part of its plan, sources said Monday this is not the case. Aryzta's banks would need the board to either recommend Elliott's offer to shareholders or signal it was not averse to a deal, in order to get the company's lenders to sign up to a key debt refinancing. This makes it very unlikely that Elliott will launch a hostile bid. Aryzta's €1 billion of bank debt and almost €200 million of other loans fall due in the event of a change of control.

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