Daniel Och: Rithm Capital deal ‘substantially undervalues’ Sculptor Capital

In a letter to the Special Committee of the Board of Directors of Sculptor Capital (SCU), Daniel Och said: “We write to express our concerns with the sale process involving the proposed acquisition of Sculptor Capital Management by Rithm Capital (RITM). We believe that the transaction with Rithm substantially undervalues the Company and penalizes all shareholders for the Board of Director’s breaches of fiduciary duty and the lack of proper oversight that has repeatedly destroyed shareholder value. Our group previously expressed concerns that the Board would pursue a transaction that does not reflect the full value of the Company, that would not maximize value for the benefit of all shareholders, and that further entrenches the interests of current Company management… Based on the public disclosures and the reactions we have heard from third parties, we believe that the Special Committee failed, and is continuing to fail, to run a sale process that is designed to achieve the best result for all shareholders and is consistent with the Board’s duties under law. We understand that there may be potential bidders who were excluded from the process prior to the announcement of the Rithm transaction and/or who are interested in transacting with the Company for higher value at this time but may be prohibited by restrictions in their non disclosure agreements from making proposals to the Company and its shareholders. We encourage the Special Committee to release all bidders from any such restrictions on the ability of third parties to make public their offers or indications of interest for the Company-a policy of transparency that surely advances the Special Committee’s duty to maximize shareholder value. A free and open process, unrestricted by the demands of management, will have the highest chance of producing the best outcome for shareholders.” Och said he remains “open to supporting a transaction that would deliver maximum value to all shareholders and account for the massive diversion of value to management, which comes entirely at the expense of the Company’s shareholders.”