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IAA holder Ancora says sale to Ritchie Bros. ‘seemingly flawed’
The Fly

IAA holder Ancora says sale to Ritchie Bros. ‘seemingly flawed’

Ancora Holdings, which is the beneficial owner of approximately 4% of the outstanding shares of IAA (IAA), sent the company’s board a letter regarding the proposed sale to Ritchie Bros. Auctioneers (RBA) which reads in part: "We have had long-standing concerns regarding IAA’s capital allocation, governance, operations and performance. That is why we previously called on the Board to either replace Chief Executive Officer John Kett or proceed with a formal sale process to maximize value for shareholders. Unfortunately, the Board appears to have ignored both requests prior to entering into a seemingly flawed and rushed transaction agreement with Ritchie Bros. last week. We view IAA’s proposed sale to Ritchie Bros. as a poorly structured sweetheart deal that puts leadership’s interests ahead of shareholders’ best interests…If the current structure and terms remain intact, we intend to do everything in our power to oppose the transaction. This will be the case despite our belief that Ritchie Bros. is a very logical and synergistic combination partner for IAA under the right circumstances…Ultimately, whatever actions Ancora takes regarding the deal approval process will be dictated by the respective share prices of IAA and Ritchie Bros. If it seems unlikely Ritchie Bros. shareholders will approve this transaction (as it currently does), we will take action to block the transaction on the IAA side. We will then seek to reconstitute the IAA Board in light of the appalling lack of appropriate governance demonstrated by the incumbent directors, including your apparent failure to initiate a transparent, wide-ranging sale process and secure other terms in shareholders’ best interests."

Published first on TheFly

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