Miranda Responds to Activist Shareholders

Posted by Joe Zaller
Dec 23 2011

Last week, two major shareholders of Miranda Technologies –JEC Capital Partners and JMB Capital Partners – requisitioned a meeting of the shareholders of Miranda to replace four of the existing directors of Miranda with four new independent directors.

Miranda has now publicly responded, saying that because several major shareholders have independently communicated to the company their opposition to the requisition for a meeting of shareholders to remove four of the seven current directors of the Company and to elect four new directors nominated by JEC and JMB.

Therefore the Board and management of Miranda believe that there are already sufficient shareholders that are opposed to the requisition, holding a sufficient number of shares of the Company, to cause the JEC/JMB proposal to fail.

The text of the press release follows:

“On December 1, 2011, JEC informed us that it owned approximately 7.0% of Miranda’s shares, demanded four seats on our Board and threatened to requisition a meeting if we declined,” said Brian Edwards, Chairman of the Board of Miranda. “As a matter of good governance, Miranda’s Board promptly undertook a clear and transparent process to consider the demand. Following the execution of a confidentiality agreement, JEC received extensive information with respect to the Company’s ongoing initiatives. The Board explored a number of options with JEC to enable them to voice their views on an ongoing basis and to contribute constructively to the enhancement of the value of Miranda’s franchise. Despite our responsiveness, transparency and open dialogue, JEC rejected our proposals and has opted to submit a formal requisition seeking to take control of the Company through the appointment of a majority of the Board. This is highly opportunistic and not something that is in the best interest of Miranda and its shareholders.

“Miranda has undertaken several proactive measures during the past 18-24 months, the benefits of which have had a tangible impact on its profitability and competitive positioning. The Company is well positioned financially, operationally and competitively to continue to drive profitable growth. Over the past year, and following the recent announcement of Miranda’s strong Q3’11 financial results, the Company’s share price has appreciated by more than 80% to $9.38 at the close of trading on Wednesday, December 21, 2011, from $5.16 on December 21, 2010. Over the same period, Miranda materially outperformed both the S&P/TSX Composite Index and the S&P/TSX Information Technology Index, which declined by 12.1% and 54.4%, respectively. For the nine-month period ended September 30, 2011, Miranda’s revenue increased 33% to $131.8 million compared to the corresponding period in 2010, while EBITDA increased 94% to $28.6 million, representing a margin of 21.7%.

Mr. Edwards noted that “our Board comprises independent and highly experienced directors, and the composition of the Board is reviewed on an ongoing basis. The Board and management remain confident that the implementation of the Company’s strategic plan and initiatives to enhance value will continue to enhance value for all of its shareholders. We must continue to focus our efforts on these important objectives.

 

Related Content:

Miranda Press Release: Miranda Responds to Requisition of Special Meeting

Activist Shareholders Seek To Replace Four Board Seats at Miranda Technologies

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