Harbert Discovery Fund Releases Detailed Investor Presentation Highlighting Case for Change at Enzo Biochem
January 08 2020 - 9:00AM
Business Wire
Puts Spotlight on Decades of Enzo’s False
Promises and Underperformance While its Board and Management
Continue to Receive Excessive Compensation at Shareholders’
Expense
Outlines Plan Addressing Immediate, Near and
Long-Term Action Items to Create Shareholder Value
HDF Believes its Two Independent Nominees –
Fabian Blank and Peter Clemens – Are the Right Fit for the Board
and Encourages Fellow Enzo Shareholders to Vote “FOR” Their
Election on the BLUE Proxy Card
Today
Full Presentation Available at
https://cureenzo.com/
Harbert Discovery Fund, LP and Harbert Discovery Co-Investment
Fund I, LP (collectively “HDF”), the beneficial owner of more than
11.8% of the outstanding shares of Enzo Biochem, Inc. (NYSE: ENZ)
(“Enzo” or the “Company”), today released a detailed investor
presentation on Enzo. The presentation outlines the Company’s
history of value destruction, persistent underperformance, and
corporate governance issues and details HDF’s Nominees’ strategic
plan to realize value at Enzo.
The complete investor presentation is available at
https://cureenzo.com/.
In the presentation, HDF explains why change is needed at the
Company, including:
- Enzo’s history of value destruction which has been
enhanced by a pattern of overpromising and underdelivering,
resulting in total shareholder returns of -49% over a 10-year
period.
- Enzo’s worst-in-class corporate governance and
executive compensation which have continued to disillusion
shareholders. Enzo has reported operating losses every year since
2004, yet the Board has approved paying Chairman / CEO Elazar
Rabbani and his brother-in-law Barry Weiner over $34 million
cumulatively since 2004, including a significant cash bonus every
year.
- The opportunity to unlock potential value at Enzo
through a series of strategic decisions, including adding two new
independent directors to the Board and executing HDF’s initiatives
to create shareholder value. Highlights of the comprehensive plan
by HDF’s Nominees include:
- Address Excess Compensation and Cost Structures:
Reassess management compensation, bloated cost structures and
planning and budgeting processes to ensure capital is being used in
the most efficient manner.
- Deliver on Potential Partnership
Opportunities: Apply a growth mindset to Enzo’s product
portfolio to determine where partnerships can help return the
Company to growth.
- Revitalize Corporate Strategy: Refocus
on Enzo’s inherent strengths of its lab’s location in a
high-density population market and strong customer relationships to
position the Company for success.
- Deliver Profitable Growth and Excess Cash
to Shareholders: Realize that through systematically targeting
the cost structure, incentive plan, and growth opportunities Enzo
can achieve profitable growth, driving substantial long-term value
for all shareholders.
VOTE ON THE BLUE PROXY CARD TO CURE ENZO TODAY
Important Information about Participants in a Proxy
Solicitation:
Harbert Discovery Fund, LP (“Harbert Discovery”), Harbert
Discovery Fund GP, LLC (“Harbert Discovery GP”), Harbert Discovery
Co-Investment Fund I, LP (“Harbert Discovery Co-Investment” and
together with Harbert Discovery, the “Discovery Funds”), Harbert
Discovery Co-Investment Fund I GP, LLC (“Harbert Discovery
Co-Investment GP”), Harbert Fund Advisors, Inc. (“HFA”), Harbert
Management Corporation (“HMC”), Jack Bryant (“Mr. Bryant”), Raymond
Harbert (“Mr. Harbert”) and Kenan Lucas (“Mr. Lucas” and together
with Harbert Discovery, Harbert Discovery GP, Harbert Discovery
Co-Investment, Harbert Discovery Co-Investment GP, HFA, HMC and
Messrs. Bryant and Harbert, the “Harbert Discovery Parties”)
(collectively, the “Participants”) have filed with the Securities
and Exchange Commission (the “SEC”) a definitive proxy statement
and accompanying form of proxy to be used in connection with the
solicitation of proxies from the shareholders of Enzo Biochem, Inc.
(the “Company”) in connection with the annual meeting of
shareholders of the Company (the “Annual Meeting”). All
shareholders of the Company are advised to read the definitive
proxy statement and other documents related to the solicitation of
proxies by the Participants in respect of the Annual Meeting, as
they contain important information, including additional
information related to the Participants, their nominees for
election to the board of directors of the Company and the Annual
Meeting. The definitive proxy statement and an accompanying proxy
card will be furnished to some or all of the Company’s shareholders
and are, along with other relevant documents, available at no
charge on the SEC website at http://www.sec.gov/ and are available
upon request from the Participants’ proxy solicitor, Okapi
Partners, by calling (888) 758-6707 (banks and brokers call collect
(212) 297-0720).
Additional information about the Participants can be found on
the Definitive Proxy Statement filed by the Participants on
December 6, 2019.
About Harbert Discovery Fund (HDF) HDF invests in a
concentrated portfolio of publicly traded small capitalization
companies in the US and Canada. We perform significant due
diligence on each portfolio company prior to investing. In addition
to researching all publicly available information and meeting with
management, our diligence includes substantial primary research
with industry experts, consultants, bankers, customers and
competitors. We often spend months or years researching ideas
before making an investment decision and we only invest in
companies that we believe are significantly undervalued, and where
there is the potential for change to enhance or accelerate value
creation. In an effort to unlock this potential value, we seek to
work directly with the boards and management teams of our portfolio
companies privately and collaboratively, engaging with them on a
range of factors including governance, board composition, corporate
strategy, capital allocation, strategic alternatives and
operations. We have effected positive, fundamental changes at our
current and past investments through this behind-the-scenes,
constructive approach. HDF currently has board representation at
three of our portfolio companies. In each case, changes to the
board were agreed upon privately and it is our strong preference in
every investment to avoid the unnecessary distractions and costs of
a public proxy campaign.
About Harbert Management Corporation (HMC) HMC is an
alternative asset management firm with approximately $6.7 billion
in regulatory assets under management as of December 1, 2019. HMC
currently sponsors nine distinct investment strategies with
dedicated investment teams. Additional information about HMC can be
found at www.harbert.net.
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version on businesswire.com: https://www.businesswire.com/news/home/20200108005489/en/
Investor Okapi Partners LLC Bruce Goldfarb / Chuck Garske
/ Jason Alexander, 212-297-0720 info@okapipartners.com
Media Sloane & Company Dan Zacchei / Sarah
Braunstein, 212-486-9500 dzacchei@sloanepr.com /
sbraunstein@sloanepr.com
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