Link to Filing: https://tinyurl.com/mza5zd9
The Reporting Persons believe that the Issuer and the Issuer’s management (the “Management”) and Board of Directors (the “Board”) have systematically failed to deliver shareholder value. The current Management and the Board publicly announced a go-forward that plan indicates no improvement for shareholders. The Reporting Persons further believe that the Issuer is a unique and highly valuable business, yet it has produced negligible shareholder return since 2010 due, in our judgment, to poor management and an ineffective Board. See presentation attached hereto as Exhibit 99.2.
Based on the Reporting Persons’ analysis of the Issuer we believe the following:
1) Significant undervaluation: the Issuer’s shares have languished for years with total shareholder returns of 0% over ~5 years.
· Shares have consistently trailed the S&P 500 by ~111% since year-end 2011
· Business is valued by public markets investors at a discount to peers
2) Challenges and root causes: the Reporting Persons believe the Issuer’s persistent undervaluation is due to ineffective management, poor capital deployment, an unqualified Board failing to oversee Management, compensation that rewards failure and excessive overhead.
3) Shareholder-focused way forward: the Reporting Persons believe the right path forward for the Board is to immediately reduce corporate overhead, publicly disclose results of Fall 2016 strategic alternatives review, strengthen the Board, cease acquisitions, and re-commence strategic alternatives review.
The Reporting Persons will seek an opportunity to meet with the Issuer’s management team to engage in constructive and value-enhancing dialogue. The Reporting Persons purchased the Common Stock for investment purposes. The intent of beneficial ownership of the Reporting Persons is to influence the policies of the Issuer and assert shareholder rights, with a goal of maximizing the value of the Common Stock.
The Reporting Persons may make further purchases of shares of Common Stock (including through a 10b5-1 plan). The Reporting Persons may dispose of any or all the shares of Common Stock held by them.
To the extent the actions described herein may be deemed to constitute a “control purpose” with respect to the Securities Exchange Act of 1934, as amended, and the regulations thereunder, the Reporting Persons have such a purpose. Except as noted in this Schedule 13D, none of the Reporting Persons currently has any plans or proposals, which relate to, or would result in, any of the matters referred to in paragraphs (a) through (j), inclusive of Item (4) of Schedule 13D. Such individuals may, at any time and from time to time, review or reconsider their positions and formulate plans or proposals with respect thereto.