PITTSBURGH, Oct. 3, 2011 /PRNewswire/ -- LCV Capital Management, LLC ("LCV Capital") issued today an open letter to the independent directors of ModusLink Global Solutions, Inc. (Nasdaq: MLNK) ("ModusLink" or the "Company") announcing its support for Peerless Systems Corporation's (Nasdaq: PRLS) two nominees to the ModusLink Board of Directors at the Company's upcoming annual meeting of stockholders.
In its letter, LCV Capital Management also demands that the ModusLink Board of Directors remove Joseph C. Lawler as Chairman, President and Chief Executive Officer of the Company, initiate a review of all strategic alternatives and return capital to shareholders through significant open-market share repurchase. Among the reasons for its demands, LCV Capital cites the precipitous decline in the Company's stock price, misuse of its balance sheet through disastrous acquisitions and investments, and poor operating performance during Mr. Lawler's tenure.
The full text of the letter follows:
October 3, 2011LCV Capital Management, LLCCentre City Tower, Suite 705650 Smithfield Street Pittsburgh, PA 15222 Dear Independent Directors of ModusLink: LCV Capital Management, LLC is currently one of the largest shareholders of ModusLink Global Solutions, Inc. (Nasdaq: MLNK), beneficially owning approximately 3.5% of the Company's common shares. We are well-informed, long-term investors in ModusLink who have met with senior management and several Board members on several occasions since we began investing in the Company in 2010. Please, by no means interpret our longstanding ownership of ModusLink common stock as an indication of confidence or support for the current management team. In fact, we are writing to express our profound disappointment with Joseph C. Lawler and his management team, as well as the Board, for their abject failure to safeguard shareholder value. We can no longer wait patiently for the Board to act to unlock the persistently discounted value of ModusLink's stock and we cannot stand by and watch the continued destruction of shareholder value. In our view, the financial performance of ModusLink under the stewardship of Mr. Lawler and the entrenched Board has been abysmal. We also believe the Company lags behind its peers in nearly every financial metric, leaving ModusLink as a chronic underperformer in the marketplace despite Mr. Lawler and his management team being richly compensated as if the Company were a star performer.