On October 27, 2021, affiliates of Mr. Icahn commenced his tender offer to purchase any and all of the
outstanding shares for $75 per share in cash upon the terms set forth in the Offer to Purchase dated October 27, 2021 (the Offer to Purchase). The Offer to Purchase contained no information about Mr. Icahns plans for
managing the Company, except for statements that Mr. Icahn intends to conduct a detailed review of the Company. In addition, the Offer to Purchase stated that the tender offer was conditioned upon the receipt of any necessary regulatory
approvals, but failed to provide what regulatory approvals would satisfy the condition, failed to make any commitment to take actions to obtain the regulatory approvals and did not provide a timeline for making an application for, or receiving, the
regulatory approvals.
Also on October 27, 2021, the Company issued a press release acknowledging Mr. Icahns announcement, confirming that the Board
would carefully review and evaluate the tender offer, and advising the Companys stockholders to take no action pending the Boards review and evaluation of the tender offer.
On November 1, 2021, the Board met via video conference with certain members of management and outside advisors to review in detail the terms of the tender offer,
as well as to review and discuss, among other things, the Companys operational performance and financial forecasts.
On November 5 and November 8,
2021, the Board met via video conference with certain members of management and outside advisors and considered various factors relating to the tender offer, including the financial analyses of the tender offer by the Companys financial
advisors. At the November 8, 2021 meeting, each of the Companys financial advisors rendered their respective oral opinions to the Board, each subsequently confirmed in writing, to the effect that, as of November 8, 2021, and based
upon and subject to the assumptions, qualifications, matters and limitations set forth in their respective written opinions, the consideration proposed to be paid to the stockholders (other than to Mr. Icahn and any of his affiliates) pursuant
to the tender offer was inadequate from a financial point of view to such stockholders. After discussion, the Board unanimously determined (i) that the tender offer is inadequate, undervalues the Company, is coercive, and is not in the best
interests of the Company and its stockholders, and (ii) that the Board would recommend that stockholders reject the tender offer and not tender any shares into the tender offer.
On November 9, 2021, the Company filed its Solicitation/Recommendation Statement on Schedule 14D-9 (the
Recommendation Statement) and issued a press release and letter to its stockholders, which, in each case, provided the recommendation from the Board that the Companys stockholders reject the tender offer and not tender their shares
into the tender offer.
Also on November 9, 2021, continuing its commitment to Board refreshment, the Board announced the appointment of E. Renae Conley and
Carlos A. Ruisanchez to the Board, in each case, effective January 1, 2022, and the retirement of Michael J. Melarkey and Stephen C. Comer, effective immediately before the Annual Meeting, due to their attainment of the Companys mandatory
retirement age. Ms. Conleys and Mr. Ruisanchezs appointment was the culmination of an extensive Board-led search which began in the first quarter of 2021. With these changes to the Board,
following the Annual Meeting, the Board would be comprised of 10 directors, 9 of whom are independent and 4 of whom had joined the Board in the last 3 years.
Later
that day, the Company conducted its third quarter 2021 earnings call. During the call, Mr. Hester highlighted how the Questar transaction is forecasted to be accretive to earnings in 2022 and that the transaction will, among other things,
position the Company to support the delivery of reliable and affordable energy services in both the short- and long-term. The earnings call also included further insight from Mr. Hester as to how the Riggs Distler transaction will accelerate
earnings per share and dividends for the Companys stockholders.
Also on November 9, 2021, Mr. Icahn issued an open letter to the Companys
stockholders in response to the Recommendation Statement.
On November 11, 2021, Mr. Icahn issued an open letter to the Board, threatening to sue the
Company if it raises equity financing at a share price of less than $75 per share without first negotiating with him.
On November 15, 2021, Mr. Icahn
notified the Company of, and issued a press release announcing, Mr. Icahns intent to nominate 10 nominees for election to the Board at the Annual Meeting and to submit two proposals for stockholder approval.
Mr. Icahns first proposal would ask the stockholders to call a special stockholders meeting in the event that Mr. Icahns slate of director
nominees were unable to be elected at the Annual Meeting because the regulatory approvals necessary to elect Mr. Icahns nominees had not yet been obtained (the Special Meeting Proposal). If approved, the special
stockholders meeting would take place no later than 45 days following the receipt of all such regulatory approvals. At the special stockholders meeting, Mr. Icahns slate of director nominees would be up for
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Southwest Gas Holdings 2022 Notice and Proxy |