Carbon fiber manufacturer Zoltek says it received a request for a special shareholders meeting from a group of investors that had acquired 10.1% of the company's stock, and who want to replace the board of directors, but it found the request to be deficient.
According to Zoltek, the shareholders are part of a group led by Quinpario Partners LLC and Jeffry N. Quinn, its chairman and CEO, seeking to remove the six current members of Zoltek's board of directors and elect a new slate of five directors. Zoltek said it advised the group that its request for a special shareholders meeting was deficient in several material respects, including both as to form and content, and as a result Zoltek does not plan to call the special meeting.
Stating that because board members own a "significant" amount of company stock the board's interests were aligned with those of common shareholders, Zoltek chairman and CEO Zsolt Rumy said in a company press release, "We will continue to focus on building long-term shareholder value by leading the commercialization of carbon fibers. Of course, if Mr. Quinn's group were to submit a bona fide proposal that adequately compensates our shareholders for the value of our technology, industry-leading capacity and future growth potential, our board would be pleased to consider it." In the interim, he reiterated it would be "business as usual" for the company.
In their SEC filing, the investors seeking the meeting said, "The Quinpario Group's substantial investment in Zoltek is based on extensive due diligence, which has led us to conclude that Zoltek is failing to deliver fully on its potential. We believe that an opportunity exists to dramatically improve Zoltek's operational performance, unlock Zoltek's significant growth potential and enhance shareholder value."
Zoltek's stock hit a 52-week low of $6.02 a share last November but climbed back 53% before yesterday's Schedule 13D disclosure filing with the SEC.
The article Zoltek Rebuffs Move to Replace Board Members originally appeared on Fool.com.Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.