A battle for supremacy at the helm of Canada’s Thunderbird Entertainment Group has entered its final phase.
Thunderbird’s management is under attack from a key shareholder, Texas-based hedge fund Voss Capital, who wants to replace the board with others who can “unlock the value.” Kim’s convenience and highway through hell Manufacturer.
A second shareholder, Railroad Ranch Capital, has also called for a “rigorous strategic review process” after it claimed Thunderbird’s public valuation did not accurately reflect its success.
Thunderbird’s board of directors last week released a statement from Voss, which owns 13.3% of the company, “correcting records…regarding false statements.”
It claims Voss initiated “an ambush proxy fight” by nominating an alternate board on the last day it’s allowed. The board called it a “calculated tactic” and said it was forced to postpone its AGM until the first quarter of 2023. That way, he could assess Voss’ experience and track record of nominating and give shareholders “all the information they need.” to decide who would control the company going forward.
Thunderbird’s current board of directors includes CEO Jennifer Twiner McCarron, Marni Wieshofer, interim chair and former CFO of Lionsgate, Frank Giustra, founder of Lionsgate, and Jerome Levy, vice chairman of Archie Comics. Voss wants to replace her with a team that includes former Hot Docs co-president and CBC chief executive Heather Conway, Voss analyst Taylor Henderson and former Rogers Media executive Shannon Valliant.
Voss had claimed to have the support of major shareholder Giustra, but he has since staunchly denied this is the case. Ten years ago he became a stakeholder.
Voss says it is “disappointed” with Thunderbird’s strategic direction and the “apparent lack of urgency to create value and lack of response to shareholder concerns.” It claims to “believe in the work Jen [McCarron] and Thunderbird management do,” but that “a lack of willingness to fully explore strategic alternatives” put the company “at a significant disadvantage compared to competitors.”
Vancouver-based Thunderbird contradicted that claim, saying its shares “outperformed the market, the industry and its peers.” It cited stats showing that the company’s share price is up 39% since it began trading in November 2018 to the day before it released its statement. During the same period, it was claimed that Canadian rivals WildBrain, Boat Rocker Media and VerticalScope Holdings had all seen significant price declines.
In reality, the current share price of CA$3.35 (US$2.51) is slightly above where it was four years ago and has risen both well below and well above these levels. It has slipped over the past year after topping above C$5 in early December 2021.
“Voss is wrong in its claim that it can unlock value for Thunderbird shareholders simply by putting up a For Sale sign,” Thunderbird said in its statement. “The prospect of a premium is not only limited by the current market environment, but also by the deal risk for non-Canadian bidders.”
Thunderbird claims Voss is trying to acquire the company without paying a bounty, claiming its nominees are “ill-equipped to conduct a qualified or thorough strategic review process” compared to his own team.