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Concerned Shareholder of Espial Group Inc. Urges Shareholders to Vote FOR a Refreshed Board of Direc

2017-06-05 19:45 [BANK] Source:Netword
Guide:TORONTO, May 23, 2017 (Canada NewsWire via COMTEX) -- Vantage Asset Management Inc. (Vantage or the Concerned Shareholder) today issued the following letter to all shareholders of Espial Group Inc. (ESP) (Espial or the Company). This lett

TORONTO, May 23, 2017 (Canada NewsWire via COMTEX) -- Vantage Asset Management Inc. ("Vantage" or the "Concerned Shareholder") today issued the following letter to all shareholders of Espial Group Inc. (ESP) ("Espial" or the "Company"). This letter urges Espial shareholders to vote FOR an improved and refreshed Board of Directors of the Company (the "Board") to preserve and enhance value for all shareholders.

The Company's share price is down ~71% since the IPO in June 2007 and down ~38% over the past two years. The deterioration in value has taken place under the oversight of a largely stagnant incumbent Board. With two exceptions (Mr. Michael Hayashi and Mr. Aamir Hussain), the average tenure for the remainder of Espial's Board is over 16 years. Given the share price performance under this leadership regime, the Company could clearly benefit from fresh ideas and perspectives from experienced, independent directors. It is time to say "no" to the status quo and vote FOR positive change by electing the Concerned Shareholder's director nominees below provided for on our BLUE proxy attached hereto:

-- Mr. Ronan McGrath o Principal: Ronan McGrath & Associates o Former Chief Information Officer & President of Shared Operations: Rogers Communications o Former Chief Information Officer & Chief Accounting Officer: CN Rail -- Mr. Christopher Mercer o Vice President Online and Telesales, Consumer Business Unit: Rogers Communications o Former Vice President of Marketing & Strategic Initiatives: MTS Allstream -- Mr. Donald (Don) Wright o President & Chief Executive Officer: The Winnington Capital Group Inc. o Former Deputy-Chair: TD Bank financial Group o Former Chairman & Chief Executive Officer: TD Securities

together with 3 of management's nominees (Jason Dolvane, Michael Hayashi and Aamir Hussain) for a reconstituted Board of 6 directors at the Company's upcoming meeting of shareholders scheduled to be held on June 13, 2017 (the "Meeting").

Vantage has worked in earnest to refresh the Board without the expense of a public campaign. Unfortunately, our private communication with the Company has yielded no real results. Since the announcement by the Company of our nomination under the Company's advance notice bylaw, we have been very encouraged by the overwhelming response from fellow shareholders, which we believe will result in much needed Board changes on June 13, 2017.


If you require additional information or require assistance voting your BLUE form of proxy, contact Kingsdale Advisors

1-877-659-1820 toll-free in North [email protected]

and they will be able to assist you to ensure your vote is counted at the Meeting.


Dear Fellow Shareholders,

Vantage is a fundamental, value-based investment manager. Both as at the record date for the Meeting and currently, we own ~9.5% of the Company. Our firm manages funds for the benefit of charitable foundations, pensions, registered wealth advisors and accredited individual investors. We have an established track for identifying value across a variety of sectors, including technology. Some of Vantage's noteworthy technology investments in recent years include the following: Com Dev International (acquired by Honeywell for a 61% premium); Given Imaging (acquired by Covidien for a 27% premium); Miranda Technologies (acquired by Belden for a 64% premium); Mosaid Technologies (acquired by Sterling Partners for a 45% premium); and Zarlink Semiconductor (acquired by Microsemi Corporation for a 67% premium).

Like you, we believe Espial represents a compelling investment opportunity for shareholders. The Company's technology platform is a viable solution for cable operators to enhance the experience of subscribers by providing seamless access to traditional broadcast and over-the-top (OTT) content and services. We believe Espial is well-positioned to become a potential leader in this segment of the cable solutions market and, if management's efforts in this regard prove successful, the opportunity for shareholders could be significant.

Unfortunately, despite a promising technology, Espial faces some considerable challenges. Perhaps the most obvious challenge is the Company's inability to generate value for shareholders since becoming a public entity 10 years ago. A variety of factors have contributed to the legacy of sub-par performance, but we believe the most pressing issue is an ineffective and stagnant Board which owns very little stock - raising the fundamental question of whether the Board's interests are aligned with those of shareholders.

Fellow Espial shareholders should ask themselves the following questions:

-- Espial's share price has dropped ~71% since the Company's IPO in June 2007 under the current leadership. Is continuing with the status quo likely to achieve the best outcome for shareholders? -- With less than ~2% of the Company's outstanding shares in aggregate, are the incumbent Board's interests appropriately aligned with those of shareholders? -- Four of Espial's incumbent directors standing for re-election have served for an average of over 16 years. Does 16 years of service convey fresh perspectives and leadership for shareholders?


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