Private equity firm Standard General has increased its stake in Tegna as activist investor Soo Kim intensifies his fight for management changes at the TV station group.
Kim, founding partner of Standard General, has boosted his stake in Tegna to 12% of shares, Standard General said Friday. On Thursday, Tegna blasted Kim for shifting about 25% of his shares to derivative positions that Tegna cast as potentially negative for the company in the long run.
Kim responded Friday with a statement reiterating his intent to field a slate of five alternate directors for Tegna’s board at its annual shareholders meeting on April 30. He also characterized Standard General as Tegna’s largest shareholder.
“We are fully committed to Tegna, and we are not going anywhere,” said Kim. “This increase in our position underscores our conviction that the Company’s intrinsic value is much higher than its market price, but also our belief that Tegna will not achieve its full potential without an upgraded Board. Our exceptional nominees have the needed experience and expertise to implement changes to Tegna’s business, operations, capital allocation and strategy to transform the Company into the best-in-class operator it should be.”
Tegna on Thursday repeated its rebuttal to Standard General’s criticisms of management and questioned his motivation for targeting the company given the wallop to the economy caused by the coronavirus pandemic.
“At a time when Standard General is seeking dramatic change to Tegna’s highly qualified, engaged and diverse Board, long-term shareholders should ask themselves why it would be in their interest to disrupt Tegna’s solid track record of delivering successful operational and financial results and prudent stewardship, especially during a time of national economic distress,” Tegna said.
Tegna shares have been battered amid the stock market swings of the past three weeks. For the year to date, shares are down 28%, closing Friday with a 10.6% drop to $10.20.