Thursday, March 11, 2021

Open Letter to SEACOR Holdings CEO

Dear Mr. Fabrikant,

I am writing to you to urge you to publicly comment on American Industrial Partners’ best and final offer for the acquisition of SEACOR Holdings Inc. 

I am struck by several insinuating statements made by AIP in their accompanying letter, chief among them that if the transaction does not close “there is significant near and long-term risk for SEACOR’s public shareholders”, and that “SEACOR is a poor fit for a public company”.

SEACOR-owned Product Carrier Independence discharging at Port Tampa Bay

As the founder and leader of SEACOR, which has been a publicly traded company since 1992, you owe to your shareholders and employees, and indeed your legacy, a clear answer to the above allegations.

In addition to being an industry leader, you have been a stalwart supporter of capital markets long before Wall Street discovered shipping. Your public comments are required reading for anyone interested in shipping and capital markets in general.

I have been closely following the tender offer by AIP to acquire all shares of SEACOR Holdings at $41.50 per share.  

Based on the facts to-date, the offer has attracted little interest from shareholders. As of the last offer extension, only 4.41% of shares had been tendered, a far cry from the required 66.7%. 

T Rowe Price, which owns 14.6% of shares outstanding and is the second largest shareholder of SEACOR, has opposed the deal, deriding it as “an opportunistic transfer of value from public-market investors to private investors”.

Ownership aside, I do not understand what AIP can bring to the table that public shareholders and capital markets don't. Especially since the company will be run by the same management team, led by your son Eric Fabrikant.

Barring a sudden change of heart among shareholders, the offer appears to be “dead on arrival”.  That should have been good news for anyone who thinks so poorly of SEACOR, like AIP appears to do. A sign of relief perhaps for a dodged bullet. 

None of which is true of course, since it was AIP who valued SEACOR at $41.50, and it is AIP who still wants to buy SEACOR.

AIP’s bravado in the face of defeat may be sour grapes, but the insinuating statements made in their last offer could have an adverse effect on the company’s stock and should be answered. There is no better person to answer them than you.

Your truly,

Lambros Papaeconomou

NYFEX Research

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