While I do agree that the takeover offer price fundamentally undervalues the business quite meaningfully, if I was a long-term shareholder in TRS I would find it quite offensive to have the directors of my company today telling me that my shares are undervalued and if I sell my shares now I would miss out on any upside potential.
For it is the sheer ineptitude of the company's board and management that, in the first place, drove the share price to a level from which there is now ostensibly all of this great "upside".
The problem here is very generous executive remuneration:
....but with virtually zero alignment of the interests of the managers of the company with the interests of its owners:
One way or another this is a board of dead men walking:
They will lose their jobs in the event that the company gets acquired, and they need to lose their jobs if they are successful in fending off a takeover.
The time for hollow-sounding management-speak along the lines of "Brilliant Basics" and "New Growth Opportunities" and expressions of hope about increased sales and margin is over. This management team has presided over more than a halving in earnings over the past 8 years; and that's despite spending almost $170m - a figure double the current market cap of the company today - on PP&E, the majority of to pursue "growth". Mostly growth of a profitless variety, as has become evident.
The current board has lost the right to continue to manage the company in the future, so they should avoid any talk of doing so.
The last remaining task of the current is to work with investment bankers to flush out competing bidders.
They should do the honourable thing and flag to the market that the company is now up for sale, and that they are happy to facilitate an auction for the business.
But any notions, that it will be business as usual for the directors should the company not fall to the highest bidder, are fanciful and misplaced and should - I believe - be articulated as such by shareholders.
In my capacity as a shareholder who owns more shares than the 5 directors and the 7 most senior management personnel, combined (!) - although it doesn't take much at all to be able make that sort of boast - I certainly have made very clear my exhortations along these lines to the members of the Board.
One way or another, current directors and management have got to go.
The sheer scale of the wealth destruction can't permit anything else.
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