Believes There Will Be Significant Interest in
Southwest Gas
Urges Stockholders to Vote the WHITE Proxy
Card to Support Southwest Gas Board to Oversee the Strategic
Alternatives Process and Maximize Value for All Southwest Gas
Stockholders
LAS
VEGAS, April 25, 2022 /PRNewswire/ -- Southwest
Gas Holdings, Inc. (NYSE: SWX) ("Southwest Gas" or the "Company")
today announced it is mailing a letter to its stockholders in
connection with its upcoming Annual Meeting of Stockholders (the
"Annual Meeting"), scheduled for May 12,
2022.
The Board strongly recommends that stockholders vote "FOR
ALL" its director nominees on the WHITE proxy card
promptly upon receipt. The proxy materials and other information
regarding the Board of Directors' recommendation for the 2022
Annual Meeting can be found at www.SWXBuildingValue.com.
Stockholders who have questions or who need help voting their
shares may call the Company's proxy solicitor, Innisfree M&A
Incorporated, at 1 (877) 825-8621 (toll-free from the U.S. and
Canada) or +1 (412) 232-3651 (from
other countries).
The full text of the letter being mailed to stockholders
follows:
Vote the WHITE Proxy Card to Support
Comprehensive Strategic Alternatives Process to
Unlock Maximum Value of Southwest Gas
April 25, 2022
Dear Fellow Southwest Gas Stockholder,
Your Board is focused on maximizing stockholder value. That is
why we rejected an inadequate $82.50
per share tender offer (the "Offer") from Carl Icahn ("Mr. Icahn"). It is also the reason
that, following the receipt of an indication of interest well in
excess of Mr. Icahn's Offer, we unanimously determined that now is
the time to commence a process to review all strategic alternatives
available to maximize value for all Southwest Gas stockholders (the
"process"). The alternatives include a sale of the Company, or a
separate sale of its business units, or our previously announced
plan to spin-off Centuri.
A VOTE FOR THE ICAHN CONTROL SLATE IS A VOTE
FOR MR. ICAHN'S INADEQUATE TENDER OFFER
As we conduct this process, it would be contrary to the
interests of Southwest Gas stockholders to have nominees that Mr.
Icahn selected as part of the Board of Directors. Indeed, Mr. Icahn
assembled his control slate of nominees specifically to take
control of the Board and further his agenda. He said so
himself.
In addition, you cannot reconcile Mr. Icahn extending his
inadequate and illusory tender offer with the statements he made in
his April 21, 2022 open letter to
stockholders. Mr. Icahn stated: "To be clear, we [Icahn
Enterprises] will not participate (that is, we will not be a
bidder) in the purported "strategic review" process run by either
the incumbent board or our new and improved board." We strongly
believe it is in the best interests of stockholders to vote the
WHITE proxy card to support the Southwest Gas value maximization
process, and to reject Mr. Icahn's control slate, which he has made
clear has been assembled solely to facilitate his efforts to take
control of the Company at an inadequate price, which is well below
our current stock price. In fact, Mr. Icahn publicly stated, "at
the very least, a majority of the Board needs to change in order to
allow for the tender offer to be completed".
Despite the confusion created by Mr. Icahn's contradictory
actions, our invitation for Mr. Icahn to participate in the process
remains open.
Our highly experienced Board is conducting this process
thoroughly and expeditiously. Members of the Southwest Gas Board of
Directors have participated in numerous highly successful public
company sale processes in various professional capacities. In fact,
two Southwest Gas directors, Jane
Lewis-Raymond and Leslie T.
Thornton, served in prominent executive leadership roles for
two of the most successful sale transactions in the gas utility
industry, the sale of Piedmont Natural Gas Company, Inc. to Duke
Energy Corporation, and the sale of WGL Holdings, Inc. to AltaGas
Ltd., respectively. Your Board's extensive transaction experience,
together with its broad and deep regulatory expertise and
experience in the utility, construction and other relevant
industries, make it the right Board to get the best possible value
for stockholders.
The Board has formed a dedicated Strategic Transactions
Committee composed solely of independent directors, Anne Mariucci, Carlos
Ruisanchez and Jane
Lewis-Raymond, to drive the review process. These directors
have strong capital markets, regulatory and M&A experience. Our
financial advisor has already begun discussions with interested
parties and we have directed our financial advisor to begin making
outbound calls to other interested parties. Again, regardless of
Mr. Icahn's misleading public commentary, we are also reaching out
to him to encourage his participation in the process.
We have already received additional inbound interest and we
believe there will be significant interest in Southwest Gas.
We urge you to vote the WHITE proxy card to ensure that
stockholders receive the maximum value for their shares by allowing
your Board to conduct this review process as expeditiously and
effectively as possible.
STRATEGIC ALTERNATIVES PROCESS MAXIMIZES VALUE
OF SOUTHWEST GAS' SUCCESSFUL
TRANSFORMATION TO UNLOCK STOCKHOLDER VALUE
Your Board and management team have taken a series of actions in
the last several years to enhance the value of our regulated and
unregulated businesses and to unlock that value for stockholders.
The strategic alternatives process is the culmination of this
strategic transformation.
ANALYSTS AGREE THAT OUR "STRATEGIC REVIEW IS A
GAME CHANGER"
Industry experts recognize that there is significant value to be
unlocked in both our regulated and unregulated businesses through
this process.
One analyst noted:
Strategic Review is Game Changer
The announcement of the strategic review of
the company, and a new higher bidder pushes the investment debate
much more to the sum of the part valuation which precedent
transactions for the three components suggest robust interest in
LDCs and construction businesses. We are incremental much more
positive on the stock.
– Citi Equity Research, 18 April 20221
SOUTHWEST GAS HAS THE RIGHT BOARD TO OVERSEE
THE STRATEGIC ALTERNATIVES PROCESS
We strongly believe that Southwest Gas has the right Board to
oversee the value maximization process. Your refreshed Board is
made up of highly qualified, independent, engaged and diverse
directors with strong industry experience, and expertise in
strategy, finance, ESG, legal/regulatory and M&A. Your Board
also includes leaders that work and live in Southwest Gas' service
jurisdictions, which is important to Southwest Gas' regulators.
Southwest Gas has a robust and ongoing Board refreshment process
to ensure the Board is composed of individuals with varied,
complementary backgrounds, who possess core competencies that
enhance our oversight and support our strategy.
Through this process, we have refreshed 40% of our Board in the
last three years, adding four highly qualified Directors to our
Board since 2019, three of whom are seasoned leaders in our
industry and all of whom bring specific and extensive relevant
M&A expertise.
We remain committed to evaluating all meaningful opportunities
to maximize value for all of our stockholders – and continuing to
lead with governance best practices.
PROTECT THE VALUE OF YOUR SOUTHWEST GAS
INVESTMENT:
VOTE THE WHITE PROXY CARD TODAY
We welcome and encourage Mr. Icahn's participation in the
process; however, we strongly believe that it would be against the
best interests of Southwest Gas stockholders to permit Mr. Icahn's
handpicked nominees to oversee the Company and the process.
Electing any of the nominees on Mr. Icahn's control slate could
have a chilling effect on the process and potentially dissuade
other parties from participating. Any of Mr. Icahn's nominees would
be inherently conflicted. If elected to the Southwest Gas Board,
Mr. Icahn's nominees would be in a position to advance his agenda
and influence the outcome of the process.
Despite the fact we have received an indication of interest well
in excess of Mr. Icahn's $82.50 per
share offer, authorized a strategic alternatives process and
invited him to participate, Mr. Icahn continues to run his proxy
contest in an attempt to take control of the Board. Conversely, the
Southwest Gas Board is committed to maximizing the value of the
Company for all stockholders.
We believe the process is best overseen by the Southwest Gas
Board of Directors and its independent Strategic Transactions
Committee, not Mr. Icahn's nominees and deputies who have been put
forward to allow him to take control of the Company.
This is a critical moment for Southwest Gas and your
investment in the Company. We are confident that our ongoing
strategic alternatives process will maximize value for all of our
stockholders.
On behalf of your Board and the management team, thank you for
your continued support.
Sincerely,
/s/ Michael J.
Melarkey
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/s/ Robert L.
Boughner
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Michael J.
Melarkey
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Robert L.
Boughner
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Chairman
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Incoming
Chairman
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YOUR VOTE IS
IMPORTANT—PLEASE USE THE WHITE PROXY CARD
TODAY!
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Simply follow the easy
instructions on the enclosed WHITE proxy card to
vote by telephone,
by internet or by signing, dating and returning
the WHITE proxy card in the postage-paid
envelope provided. If you received this letter by email, you may
also vote by pressing the
WHITE "VOTE NOW" button in the accompanying
email.
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Remember--please do
not vote using any gold proxy card you may receive from Mr.
Icahn,
(even as a "protest vote"). A vote on the gold proxy card
will revoke your prior vote for that
account on the WHITE proxy card. If you inadvertently
voted using the gold proxy card, you
can always cancel that vote by voting again using the WHITE
proxy card--only your latest-
dated proxy counts!
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If you have
questions about how to vote your shares, please call the firm
assisting us with
the solicitation of proxies, Innisfree M&A
Incorporated, at:
1 (877) 825-8621 (toll-free from the U.S. and Canada)
or
+1 (412) 232-3651 (from other locations)
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Lazard is serving as financial advisor to Southwest Gas and
Morrison & Foerster LLP and Cravath, Swaine & Moore LLP are
serving as legal advisors.
About Southwest Gas Holdings, Inc.
Southwest Gas Holdings, Inc., through its subsidiaries, engages
in the business of purchasing, distributing and transporting
natural gas, and providing comprehensive utility infrastructure
services across North America.
Southwest Gas Corporation, a wholly owned subsidiary, safely and
reliably delivers natural gas to over two million customers in
Arizona, California and Nevada. The Company's MountainWest subsidiary
provides natural gas storage and interstate pipeline services
within the Rocky Mountain region. Centuri Group, Inc., a wholly
owned subsidiary, is a strategic infrastructure services company
that partners with regulated utilities to build and maintain the
energy network that powers millions of homes and businesses across
the United States and Canada.
How to Find Further Information
This communication does not constitute a solicitation of any
vote or approval in connection with the 2022 annual meeting of
stockholders of Southwest Gas Holdings, Inc. (the "Company") (the
"Annual Meeting"), scheduled to be held May
12, 2022. In connection with the Annual Meeting, the Company
has filed a definitive proxy statement with the U.S. Securities and
Exchange Commission ("SEC"), which the Company has furnished to its
stockholders in connection with the Annual Meeting. The Company may
furnish additional materials in connection with the Annual Meeting.
BEFORE MAKING ANY VOTING DECISION, WE URGE STOCKHOLDERS TO READ THE
PROXY STATEMENT (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO)
AND WHITE PROXY CARD AND OTHER DOCUMENTS WHEN SUCH INFORMATION IS
FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY, BECAUSE THEY
CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY AND THE ANNUAL
MEETING. The proposals for the Annual Meeting are being made solely
through the definitive proxy statement. In addition, a copy of the
definitive proxy statement may be obtained free of charge from
www.swgasholdings.com/proxymaterials. Security holders also may
obtain, free of charge, copies of the proxy statement and any other
documents filed by Company with the SEC in connection with the
Annual Meeting at the SEC's website at http://www.sec.gov, and at
the Company's website at www.swgasholdings.com.
Important Information for Investors and Stockholders: This
communication does not constitute an offer to buy or solicitation
of an offer to sell any securities. In response to the tender offer
for the shares of the Company commenced by IEP Utility Holdings LLC
and Icahn Enterprises Holdings L.P., the Company has filed a
solicitation/recommendation statement on Schedule 14D-9 with the
SEC. INVESTORS AND STOCKHOLDERS OF SOUTHWEST GAS HOLDINGS ARE URGED
TO READ THE SOLICITATION/RECOMMENDATION STATEMENT AND OTHER
DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and stockholders
may obtain a free copy of these documents free of charge at the
SEC's website at www.sec.gov, and at the Company's website at
www.swgasholdings.com. In addition, copies of these materials may
be requested from the Company's information agent, Innisfree
M&A Incorporated, toll-free at (877) 825-8621.
Forward-Looking Statements: This press release
contains forward-looking statements within the meaning of the U.S.
Private Securities Litigation Reform Act of 1995, Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such statements
include, without limitation, statements regarding Southwest Gas
Holdings, Inc. (the "Company") and the Company's expectations or
intentions regarding the future. These forward-looking statements
can often be identified by the use of words such as "will",
"predict", "continue", "forecast", "expect", "believe",
"anticipate", "outlook", "could", "target", "project", "intend",
"plan", "seek", "estimate", "should", "may" and "assume", as well
as variations of such words and similar expressions referring to
the future, and include (without limitation) statements regarding
expectations with respect to a separation of Centuri, the future
performance of Centuri, Southwest Gas's dividend ratios and
Southwest Gas's future performance. A number of important factors
affecting the business and financial results of the Company could
cause actual results to differ materially from those stated in the
forward-looking statements. These factors include, but are not
limited to, the timing and amount of rate relief, changes in rate
design, customer growth rates, the effects of
regulation/deregulation, tax reform and related regulatory
decisions, the impacts of construction activity at Centuri, whether
we will separate Centuri within the anticipated timeframe and the
impact to our results of operations and financial position from the
separation, the potential for, and the impact of, a credit rating
downgrade, the costs to integrate MountainWest, future earnings
trends, inflation, sufficiency of labor markets and similar
resources, seasonal patterns, the cost and management attention of
ongoing litigation that the Company is currently engaged in, the
effects of the pending tender offer and proxy contest brought by
Carl Icahn and his affiliates, and
the impacts of stock market volatility. In addition, the Company
can provide no assurance that its discussions about future
operating margin, operating income, COLI earnings, interest
expense, and capital expenditures of the natural gas distribution
segment will occur. Likewise, the Company can provide no assurance
that discussions regarding utility infrastructure services segment
revenues, EBITDA as a percentage of revenue, and interest expense
will transpire, nor assurance regarding acquisitions or their
impacts, including management's plans or expectations related
thereto, including with regard to Riggs
Distler or MountainWest. Factors that could cause actual
results to differ also include (without limitation) those discussed
under the heading "Risk Factors" in the Company's most recent
Annual Report on Form 10-K and in the Company's and Southwest Gas
Corporation's current and periodic reports, including our Quarterly
Reports on Form 10-Q, filed from time to time with the SEC. The
statements in this press release are made as of the date of this
press release, even if subsequently made available by the Company
on its Web site or otherwise. The Company does not assume any
obligation to update the forward-looking statements, whether
written or oral, that may be made from time to time, whether as a
result of new information, future developments, or
otherwise.
Participants in the Solicitation: The directors
and officers of the Company may be deemed to be participants in the
solicitation of proxies in connection with the Annual Meeting.
Information regarding the Company's directors and officers and
their respective interests in the Company by security holdings or
otherwise is available in its most recent Annual Report on Form
10-K filed with the SEC and the definitive Proxy Statement on
Schedule 14A filed with the SEC in connection with the Annual
Meeting. Additional information regarding the interests of such
potential participants is included in other relevant materials
filed with the SEC.
Contacts
For investor information, contact: Boyd
Nelson, (702) 876-7237, boyd.nelson@swgas.com; or Innisfree
M&A Incorporated, Scott
Winter/Jennifer
Shotwell/Jon Salzberger,
(212) 750-5833.
For media information, contact: Sean
Corbett, (702) 876-7219, sean.corbett@swgas.com; or
Joele Frank, Wilkinson Brimmer
Katcher, Dan Katcher / Tim Lynch, (212) 355-4449.
1 Permission
to use quote neither sought nor obtained. The Company is not
endorsing or adopting the contents of the report, and it is not
incorporated into this letter.
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SOURCE Southwest Gas Holdings, Inc.