Navigation Links
InfoGroup Founder and Board Member Criticizes Adoption of Poison Pill
Date:5/18/2009

Board Should Pursue Strategic Alternatives Rather than Seek to Entrench Itself

OMAHA, Neb., May 18 /PRNewswire/ -- Vinod Gupta, the founder, member of the board of directors and holder of approximately 39% of the outstanding stock of InfoGroup (Nasdaq: IUSA) announced today that he strongly disagreed with the Company's recent decision to adopt a poison pill and believes that the Company must explore strategic alternatives.

"I believe that the Board of Directors' adoption of a 'poison pill' demonstrates that many of the directors are willing to entrench themselves at the expense of the Company's stockholders," said Mr. Gupta. "Unfortunately, this conduct is consistent with past Board actions. When I entered into a settlement agreement with the Company in 2008, the Board insisted that I vote all my shares in favor of the Board's nominees for director rather than proportionately with the shares of the Company's unaffiliated stockholders, as I had strongly demanded. The Board simply wanted to control my votes (approximately 39% of the Company's voting stock) to assure that they could keep their board seats rather than give the stockholders, to whom they should owe their allegiance, a meaningful say in the election of directors," Mr. Gupta stated.

"I regret that some members of this Board, who do not own a meaningful amount of stock in the Company like I do, seem much more interested in assuring that they retain their directorships than in doing what is best for the stockholders of the Company. I sincerely hope that all stockholders, as well as Risk Metrics, let these members of the Board know their displeasure with the Board's decision to adopt a rights plan," Mr. Gupta continued.

"It is bad enough that a majority of the Board would take this action against the best interests of all of the stockholders. However, in my case, their conduct amounts to a breach by the Board of an agreement between the Company and me, as described in the letter to the Board attached to this press release," said Mr. Gupta.

"Even the adoption of the poison pill might not be so bad in isolation. But the poison pill has to be judged against the background of the Company's dismal performance since new management was installed and other actions by a majority of the Board to feather the nest of directors and senior management. These include:

  • The Company's revenues in the March 2009 quarter declined 17% and operating income declined 34% from the first quarter of last year.
  • These results are much worse than the Company's peer group: in the March 2009 quarter, Dun & Bradstreet's revenues only declined 2% and its operating income actually increased 5% from the first quarter of last year.
  • The Board has discontinued the Company's annual dividend, depriving the stockholders of last year's dividend of $0.35 per share.
  • This dismal performance hasn't stopped the Board from treating itself and management quite well.
    • Four of the directors received directors fees of approximately $296,000, $288,000, $273,000 and $248,000, respectively, in 2008. This is a total of directors fees of approximately $1,105,000 for just these four directors.
    • The Board gave away more than 900,000 shares of restricted stock to senior management.
    • The Board gave change of control benefits for the four top officers that could total approximately $9,400,000.
    • The Board provided a compensation package to its new CEO, who has no experience in the industry, which contemplates $1,500,000 annual cash compensation as well as discretionary equity compensation. In 2008, the fair value of the CEO's discretionary equity compensation was $726,000, such that his total 2008 compensation was $2,226,000.

Mr. Gupta said.

"I strongly believe that it is in the best interests of the stockholders for the Board to explore the Company's strategic alternatives rather than for the Board to seek to entrench itself and waste money on the Board and the Company's top executives. In my capacity as a stockholder of the Company, I have been approached by both strategic and financial buyers about potential transactions but I believe the Company has failed to engage with them in any meaningful way. I remain open to a sale of the Company and would be willing to participate (or not participate) with the buyer if that helped get a transaction done," Mr. Gupta concluded.


'/>"/>
SOURCE Vinod Gupta
Copyright©2009 PR Newswire.
All rights reserved

Related medicine news :

1. President George W. Bush Appoints Susan G. Komen for the Cure Founder as Chief of Protocol
2. Center for Health Transformation Founder Newt Gingrich Calls on Congress to Pass a Clean SCHIP Six-Month Extension
3. Forbes Honors Susan G. Komen for the Cure Founder as Trailblazer
4. Cardinal Health Names CEO R. Kerry Clark as Chairman; Company Founder Robert D. Walter to Retire After 36 Years
5. Susan G. Komen for the Cure Founder Sworn in as Chief of Protocol
6. FalconStor Software Inc. Founders Make Multi-Million Dollar Donation to North Shore-LIJ Health System for Asian Community Health Center in Flushing
7. GeoVax Co-Founder Dr. Harriet Robinson Named 2007 AAAS Fellow
8. Former NFL Star Tiki Barber and CURE Founder Susan Axelrod Speak Out About Epilepsy on TODAY Show
9. Lenny Dykstra, Founder & President of The Players Club, to Keynote the 2008 Financial Communications Forum
10. Intel Co-Founder Andrew S. Grove Dedicates Portion of His Estate, Up to $40 Million, to Michael J. Fox Foundation
11. Childrens Hospital Boston Mourns the Death of Dr. Judah Folkman, World Renowned Researcher and Founder of the Field of Angiogenesis
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:2/20/2017)... ... ... Clearwave is the leading provider in patient ... of touch screen terminals. Both companies will be showcasing their solutions at Posiflex ... Posiflex is helping to bridge the gap between healthcare hardware and software through ...
(Date:2/20/2017)... Sunapee, NH (PRWEB) , ... February 20, 2017 , ... ReportingMD, a Population Health Software ... rapid growth of the company. The new location will triple the size of the ... location for the town of Sunapee, NH. , “We are excited to expand ...
(Date:2/20/2017)... FL (PRWEB) , ... February 20, 2017 , ... ... gift from Constellation Brands to purchase a new ultrasound-enhanced thrombolysis machine, a state-of-the-art ... waves. The gift was facilitated by the Pepin Family Foundation. , “We greatly ...
(Date:2/19/2017)... ... February 19, 2017 , ... Orbita, Inc., a ... with Healthwise ® at HIMSS 2017 to showcase a breakthrough ... health education, technology and services, will demonstrate a voice-powered knowedge assistant based on ...
(Date:2/18/2017)... ... February 17, 2017 , ... Park Cities Pet Sitter President, Joette White, ... Pet Life Radio network. The episode, which was posted this week, features a ... factors led to Park Cities Pet Sitter’s being awarded the 2017 National Association of ...
Breaking Medicine News(10 mins):
(Date:2/17/2017)... PUNE, India , February 17, 2017 ... Product (Airborne Particle Counters, Liquid Particle Counters), Application (Cleanroom Monitoring, Contamination ... Global Forecast to 2021" published by MarketsandMarkets, the market is expected ... in 2016, at a CAGR of 3.7% from 2016 to 2021. ... ...
(Date:2/17/2017)... 2017 Research and Markets has announced the addition ... report to their offering. ... report provides separate comprehensive analytics for the US, Canada ... Asia-Pacific , and Rest of World. Annual estimates and forecasts ... analysis is provided for these markets. Market data and analytics are derived ...
(Date:2/17/2017)...   FormFast , the leader in electronic forms ... Engage , one of the largest MEDITECH partners ... will serve as the forms automation and electronic signature ... .  FormFast is a MEDITECH collaborative ... enhance the electronic health record. FormFast,s technology bridges clinical ...
Breaking Medicine Technology: