Comtech Hits Back at Claims from Shareholder Outerbridge
Comtech Telecommunications is in a public dispute with shareholder Outerbridge Capital Management ahead of its upcoming fiscal 2021 annual meeting of stockholders this month. On Monday, Comtech issued a presentation called “Correcting the Record” that addresses Outerbridge’s claims.
Outerbridge Capital Management owns approximately 4.95% of Comtech stock and has called for a refresh of Comtech’s board of directors, nominating Sidney Fuchs, chairman of the board at Eutelsat America Corporation, and Wendi Carpenter, retired U.S. Navy rear admiral. Outerbridge has sent letters to shareholders detailing a lack of faith in Comtech’s management and board.
Comtech had multiple lines of complaint against Outerbridge in its Monday letter to shareholders, arguing that Outerbridge misrepresented the company’s financial performance, and that Outerbridge did not permit its nominees to participate in standard board-selection due diligence. In addition, Comtech argued that Fuchs’ conflict of interest with Eutelsat would “significantly damage key customer relationships and negatively impact prospective business opportunities.”
“Outerbridge appears to have no value creation plan beyond writing public letters riddled with inaccuracies and misleading, unsubstantiated claims; wasting our board’s time with an ever-changing selection of director candidates; and actively trading in and out of Comtech’s stock over the past several months while holding a substantial portion of their “ownership” position in short-dated options,” Comtech wrote in Monday’s letter to shareholders.
Comtech has two members of the board up for election this year — Judy Chambers and Larry Waldman. Chambers was added to the board in August and is the managing principal and director of Meketa Investment Group. Larry Waldman joined the board in 2015 and serves as a member of the board of directors and lead independent director of APYX Medical.
Comtech plans for other changes to its board as well. Mark Quinlan, co-founder of Comtech investor White Hat Capital Partners has been appointed to the company’s board of directors with a $100 million investment from White Hat and Magnetar Capital announced in October. And, new CEO Michael Porcelain will join the board when he takes over from Fred Kornberg by the end of thear.
Comtech’s fiscal 2021 annual meeting of stockholders is scheduled for Dec. 17.