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TheStreet Open House

FrontFour Delivers Letter To Fisher Communications Stockholders

Stock quotes in this article: FSCI

Let us say once again so the record is absolutely clear:

  • This election is not about us seeking to take control of Fisher, nor is it even possible given the cumulative voting regime for the election of directors.  
  • This election is not about us trying to push through the Huntingdon offer. We have already stated publicly that FrontFour does not believe the Huntingdon offer provides full value for Fisher, and FrontFour has never pushed Fisher to accept the offer.

This election is about accountability and charting a new course for value creation.

THE COMPANY CONTINUES TO FAIL TO TAKE ACTIONS TO ADDRESS ITS POOR STOCK PRICE AND POOR OPERATING PERFORMANCE  

FrontFour was compelled to run this election contest because after having one representative on the Board for two years, we were unable to get the Board to take the necessary steps to improve stockholder value.  Let us look at one example.  We believe the Company should have taken more proactive steps toward returning capital to stockholders rather than waste over $90 million on ill-conceived acquisitions.  Mr. Lorber lobbied strongly for the Company to buy back its bonds once on the Board and had to persuade members of the Board each time.  Still, enough has not been done as the Board continues to push aside other significant issues.

HOW MUCH LONGER CAN YOU AFFORD TO HAVE A CEO AND BOARD THAT REFUSES TO ACCEPT ACCOUNTABILITY FOR THEIR DECISIONS?

At the forum last week, the Company's CEO addressed the long history of missed expectations and low operating margins by making excuses, the most dubious of which being that the broadcast industry has been a very difficult industry since she took the CEO position in 2005 and that the most recent 2009 period did not help. We question that assertion as competitors have consistently been able to outperform Fisher's margins over this period of time.  Clearly, the Company's CEO does not get it.  Also, if it was such a difficult time, then why did the Board approve the acquisition of the Bakersfield assets for $55 million at industry peak multiples?  What has been the result?  No significant improvement in operating margins.

Also at last week's forum, a significant stockholder took to task the CEO and the Fisher Board for their poor performance, lack of transparency and all-around disregard for stockholders.

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