Glass Lewis Recommends FOR the MGP Ingredients Board Nominees on the WHITE Proxy Card
MGP Ingredients, Inc. (Nasdaq: MGPI) (the "Company") today announced that Glass, Lewis & Co., LLC, a leading provider of proxy voting advisory services to institutions and other professional investors, recommends stockholders support MGP's current management team and Board by voting FOR the Company's director nominees on the Company's WHITE proxy card at the Company's 2013 Annual Meeting of Stockholders to be held on August 23, 2013.
Glass Lewis' report is a resounding vote in favor of MGP and the actions its independent directors and management team are taking to deliver value to all stockholders. Glass Lewis is an independent third party trusted by over 900 clients, including pension plans, mutual funds and asset managers that collectively manage more than $15 trillion in assets, to provide unbiased advice in contested proxy contests. Their clear support of MGP's director nominees highlights the importance of keeping independent voices on the MGP Board to protect the interests of common stockholders and is another reason stockholders should vote the WHITE proxy card.
In their report dated August 9, 2013, Glass Lewis clearly indicates its support for MGP's director nominees (emphasis added):
"Given that the Cray family already exerts significant influence over the Company through its ownership of 92% of the preferred shares, giving it the right to elect five of the Company's nine directors, and 27.5% ownership of the common shares, we believe it is particularly important in this case for independent directors to maintain their current position. In our view, in light of recent actions, the independent directors are more likely to act in the best interests of all shareholders than is the Cray family."
The Glass Lewis report goes further to address important topics that should be carefully considered by stockholders before casting their vote:
On the positive impact of MGP's management-led transformation and corresponding stock price performance:
"...MGP's stock price has outperformed peers and the index. In our view, the Company's most recent stock price performance is indicative of a better performing company that is implementing a strategy that has begun to yield positive financial results."
On the strength of MGP's nominees and management:
"In our view, Mr. Speirs strongly and effectively defends his campaign for continued service as the Company's chairman and for Mr. Newkirk to continue as the Company's CEO...Given their previous support of Mr. Newkirk, it's unclear as to why the Cray family has turned on Mr. Newkirk and the management team now, especially considering that the Cray family continues to believe in the merits of the Company's strategy."
On the Cray Group's criticisms of MGP's executive and director compensation plan:
"Furthermore, we find the Dissident's concerns regarding executive and director pay somewhat disingenuous given that both Mr. Cray, Jr. and Mrs. Seaberg voted in favor of the current compensation of management on two occasions, with the most recent vote on July 11, 2013, according to the Company."
THE CRAY GROUP CONTINUES TO INTERFERE WITH THE BOARD'S FIDUCIARY DUTIES
Consistent with their fiduciary duties, the independent directors of MGP are exploring any alternative that could maximize value for all common stockholders. In their report, Glass Lewis supports MGP's review of strategic alternatives:
"Still, we recognize that a review of the Company's strategic alternatives is a legitimate undertaking by the board and is in fact a sign of a well-functioning board. One of any board's responsibilities is to evaluate the company's business strategy and, when necessary, conduct an in-depth review or exploration of strategic alternatives that could better or more quickly maximize shareholder value."
Cray Group members Karen Seaberg and Bud Cray have made it clear they will not seriously consider potential strategic alternatives. Their position is difficult to reconcile with their fiduciary duties as directors and is not in the best interests of common stockholders.
Stockholders must carefully consider whether they want to turn even more control over to a group so clearly intent on using its existing control to pursue its own self-interest.
The independent directors of MGP believe that stockholders cannot allow the Cray Group to increase their control over MGP. MGP urges stockholders to vote the WHITE proxy card to ensure independent leadership at MGP will continue to serve the best interests of all stockholders, not just the interests of a single family.
If you have questions about how to vote your shares, or need additional assistance, please contact the firm assisting us in the solicitation of proxy votes:
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