Stelios is "outraged"
Stelios Haji-Ioannou, self-described "serial entrepreneur" and founder of Stelmar Shipping Ltd., today said he was "outraged" by the Stelmar Board's refusal to "even engage with discusssions with OMI" about its proposed acqusition.
Haji-Ionnou issued his statement following OMI's announcement today that it was withdrawing its offer for Stelmar.
Stelmar announced its plans to acquire Stelmar on May 17, when it revealed that Haji-Ioannou and his brother and sister, who together control about 27% of Stelmar's outstanding shares, had agreed to support the deal.
"I am outraged by the refusal of the Board of Stelmar even to engage in discussions with OMI," saidv the statement issued by Haji-Ioannou today. "Refusing to investigate whether shareholder value can be further maximized must be a breach of the board's fiduciary duties."
The statement said that OMI's offer to exchange each Stelmar share for 3.1 OMI shares at OMI's closing price last night was worth $37.57 for each Stelmar share. "The Stelmar actual closing price last night was $30.42 and has been declining," noted the statement. "Before the OMI offer was made public in mid-May the stock was trading in the mid twenties!"
"Assuming the Stelmar stock reverts back to that level," continued the statement, "the potential value destruction by the Stelmar Board will exceed $200 million (17 million shares outstanding with about $12-$13 per share loss compared to the current value of the OMI offer). My family stands to suffer 27% of that loss in value, amounting to more than $50 million."
"I do hope the Stelmar board's refusal even to discuss the OMI offer as well as its deliberate decision to strip shareholders of critically important rights by purporting to amend the company's by-laws are just tactics designed to test the willingness of OMI to improve its offer," said Hadji-Ioannou.
"With OMI's announcement that it has decided to withdraw its offer I now have serious doubts about the effectiveness of such measures, and I urge the Stelmar board to reconsider its approach in order to maximize value for all Stelmar shareholders," he continued. "If these tactics and the other decisions by the Stelmar board result in permanent value destruction, I reserve my right to take whatever action necessary to protect my investment in Stelmar. I would expect that other Stelmar shareholders will do the same."