CALGARY, Alberta–(BUSINESS WIRE)–Cation Capital Inc. (together with its affiliates and associates, “Cation Capital” or “Cation”), a private investment firm, today issued the following statement to shareholders of Crescent Point Energy Corp (TSX/NYSE: CPG) (“Crescent Point”) in connection with Crescent Point’s 2018 Annual General Meeting of Shareholders to be held on May 4, 2018. Shareholders of record as of March 22, 2018, are entitled to vote at this meeting.
Sandy L. Edmonstone, President of Cation Capital, said:
“Cation Capital has asked Crescent Point shareholders one central question ‘Are you happy with the performance of your investment or is it time for a change?’ We have heard from numerous shareholders, large and small, that they are not happy with performance and they support a change in leadership.
“Shareholders also openly recognize that, rather than try to defend a disastrous track-record, Scott Saxberg and team have only one strategy – roll out baseless statements and defer blame for destroying almost $11 billion of shareholder value over the last five years while they continue to profit.
“Whether we direct you to Crescent Point’s cratered share price, its worst-in-class valuation multiple, its excessive G&A costs and executive compensation or its rising debt and leverage (all of which are objective measurable factors that are indisputable by Crescent Point) – it is abundantly clear that Crescent Point’s boardroom houses individuals that are completely delusional about the state of what is a broken company, and who are wholly unfit to resurrect it.
“In contrast to the current Board, Cation and its nominees have actual public company board experience – a combined over 70+ years, as compared to less than one year of aggregate prior experience held by the six most recent appointees and nominee to Crescent Point’s board – and actual alignment with Crescent Point shareholders, with our nominees owning in excess of $15 million of stock, more than double the amount owned by the incumbent non-employee directors.
“Our view is simple: this broken company needs new leadership that is committed to restoring the market’s confidence, significantly enhancing Crescent Point’s share price and ensuring long term sustainability. The Cation nominees have the experience, leadership and discipline to take this necessary approach. We look forward to the support of shareholders in the election of our four nominees.”
Cation Capital asks shareholders to consider some select statements from Crescent Point’s recent letter:
CPG: “We – and, more importantly, the investment community – believe that our current Board and management are on the right track.”
Cation would highlight that the stock is around a 15-year low because the investment community does NOT believe the company is on the right track.
CPG: “While we know that not all of the changes we have implemented have been popular, they have been necessary in this environment and, in the end, will be proven right.”
We would note that the track-record doesn’t instill much faith in these Pollyanna statements of “trust us.”
CPG: “Based on the information available at the time, we took the steps we believed were necessary to protect shareholders.”
Losing almost $11 billion of market value over five years while receiving compensation at the highest end of a better performing peer group is contradictory.
CPG: “As the downturn persisted, we made another difficult decision to raise equity to protect our balance sheet in the event oil prices lingered for longer than the market expected, which in fact is what happened.”
The company did not “protect the balance sheet.” The dilutive equity raise was reactive to the issues resulting from its ill-timed acquisitions. Wouldn’t it have been better to be prudent with capital than increase overall debt?
CPG: “Nine of our 10 directors are independent and 20 percent are women. The election of Sandy’s nominees could result in the loss of female board members.”
This statement is insulting and assumes that shareholders are completely ignorant to the qualifications of individuals directors and the importance of diversity.
CPG: “Our overall approach is market-competitive and comparable to peers.”
The same peers who have vastly outperformed Crescent Point? Or are they discussing the inflated compensation to be paid as much as these outperforming peers?
CPG: “Sandy’s criticism is based on incomplete information and a flawed analysis.”
Cation would like nothing better than to discuss the history and track-record of this leadership team, even under recent directors. Rather than argue fact, this is Scott Saxberg and team’s effort to distract from the real issues at hand.
Don’t let the incumbent Crescent Point board continue to fail you. Vote for the Cation nominees – Dallas Howe, Herbert Pinder, Thomas Budd and Sandy Edmonstone – on your BLUE proxy or BLUE VIF.
Shareholders are urged to read the circular and vote their BLUE proxy or BLUE VIF by 5:00 p.m. (Calgary time) on Tuesday, May 1, 2018. Shareholders with questions about voting their shares should call Cation’s strategic shareholder advisor and proxy solicitor, D.F. King, at 1-800-835-0437 toll- free in North America, or 1-201-806-7301 outside of North America (collect calls accepted), or by e-mail at email@example.com.
Shareholders are also encouraged to visit www.FixCPG.com to learn more about how the right people and right plan can create long-term value for all. A copy of Cation Capital’s information circular is also available on Crescent Point Energy Corp’s SEDAR profile at www.sedar.com.
For questions or assistance, please contact Cation’s strategic shareholder advisor and proxy solicitor, D.F. King, at 1-800-835-0437 toll-free in North America, or 1-201-806-7301 outside of North America (collect calls accepted), or by e-mail at firstname.lastname@example.org.
About Cation Capital Inc.
Cation Capital Inc., together with its affiliates and associates, is a private investment firm headquartered in Alberta, Canada. Cation invests in situations where it is able to influence operational, financial and strategic direction. Cation seeks value in companies that are experiencing financial or operational challenges, are in out of favour sectors or are otherwise in need of change to drive significant long-term value for stakeholders.