2014

Sandell Asset Management Files Preliminary Proxy Statement for InfoSpace, Inc. Seeks Minority Board Representation On Behalf Of All InfoSpace Shareholders



    NEW YORK, April 16 /PRNewswire/ -- Sandell Asset Management Corp.
 ("Sandell") today filed a preliminary proxy statement with the Securities
 and Exchange Commission in connection with its planned solicitation of
 proxies for the May 31, 2007 Annual Meeting of Shareholders of InfoSpace,
 Inc. (Nasdaq:   INSP). As InfoSpace's largest shareholder, owning
 approximately 8.8% of its outstanding shares, Sandell is seeking support
 from all InfoSpace shareholders to elect its three highly qualified and
 independent nominees in order to establish strong shareholder
 representation on InfoSpace's Board of Directors.
     In its preliminary proxy statement, Sandell cited the following key
 reasons why change is needed at InfoSpace and why shareholders should
 support our Slate of Nominees:
     * Dramatic Share Price Underperformance -- Over the past two years, under
       the watch of the current Board of Directors, InfoSpace shares have
       declined 45%, destroying $730 million of shareholder value, during a
       very healthy broad equity market and internet/technology investment
       environment.
 
     * Questionable Management Decision-Making -- We believe the poor share
       price performance can be traced to management missteps including
       misallocation of cash flow into businesses with poor fundamentals and
       failure to maximize existing assets.  The current board has presided
       over this destruction of value and has either approved or acquiesced in
       the decision making and capital allocation that we believe led to these
       results.
 
     * Deteriorating Financial Results -- InfoSpace's operating income
       (excluding restructuring charges and stock-based compensation) has
       deteriorated steadily since the end of 2004, despite positive organic
       and acquisition related revenue growth.  We believe that this poor
       performance has been caused by 1) investment in a risky, and ultimately
       failed, mobile growth strategy, 2) failure to maximize profitability
       and drive growth at Online and 3) complacency over costs and poor
       internal controls.
     As the Company's largest shareholder, we believe that the addition of
 new qualified and independent shareholder-nominated directors is necessary
 to help make critical structural, financial and strategic decisions over
 the next year. Specifically, if elected, our Nominees intend to urge the
 Board to execute the following initiatives:
     * Review composition of assets -- immediate sale of the remaining mobile
       business, focus on Online segment, maximize use of NOLs -- We believe
       that the ideal strategy involves a sale of the mobile business and
       bolstering the operations of the highly profitable and cash generative
       online business, simultaneously maximizing the value of the company's
       NOLs. We believe that there are several parties who would be interested
       in acquiring the mobile business for values well in excess of that
       implied by the current share price.  Our nominees would push for the
       immediate retention of an investment bank to accomplish this strategic
       review.
 
     * Return of Capital -- the company does not have a suitable use for its
       greater than $400 million of cash and a substantial portion of this
       capital should be returned to shareholders -- We remain concerned that
       as long as the cash remains on the balance sheet, there is a tangible
       risk that it will be spent on risky acquisitions.  Our nominees would
       work expeditiously with the current board and financial advisors to
       determine an optimal plan for immediate return of a substantial portion
       of the $400 million cash balance through stock repurchases and
       distributions.  The company's management frequently pays lip service to
       a capital return strategy, but the time for deliberation is past and
       decisive action should be taken immediately.
 
     * Cost Cutting -- the conglomerate style corporate structure results in
       unnecessary expense and duplicative administrative layers -- We believe
       that InfoSpace is burdened with a sub-optimal expense structure that
       masks the true profitability of the Online segment.  Once the mobile
       business is sold, our nominees would work aggressively to simplify the
       corporate structure, eliminate duplicative management layers and provide
       a more balanced incentive-based compensation structure company-wide.
     We are confident that our Nominees would, if elected, help bring more
 accountability, focus and discipline to the way InfoSpace is managed. Our
 Nominees are committed to confronting more effectively the critical issues
 and decisions facing the Company and, if elected, will seek to ensure that
 the company delivers on its opportunities to enhance long-term shareholder
 value for all shareholders.
     We believe that our Nominees are well suited to help create significant
 shareholder value at InfoSpace. Our Nominees are committed to acting in the
 best interests of all shareholders. We believe that your voice in the
 future of InfoSpace can best be expressed through the election of our
 Nominees.
     About Sandell Asset Management Corp.
     Sandell Asset Management Corp. (and affiliated companies), based in New
 York, NY, is an investment management firm founded by Thomas E. Sandell
 that focuses on corporate event driven investing worldwide. Sandell often
 will take an "active involvement" in facilitating financial or
 organizational improvements that will accrue to the benefit of
 shareholders.
     THIS PRESS RELEASE IS FOR GENERAL INFORMATIONAL PURPOSES ONLY. IT DOES
 NOT HAVE REGARD TO THE SPECIFIC INVESTMENT OBJECTIVE, FINANCIAL SITUATION,
 SUITABILITY, OR THE PARTICULAR NEED OF ANY SPECIFIC PERSON WHO MAY RECEIVE
 THIS PRESS RELEASE, AND SHOULD NOT BE TAKEN AS ADVICE ON THE MERITS OF ANY
 INVESTMENT DECISION. THE VIEWS EXPRESSED HEREIN REPRESENT THE OPINIONS OF
 SANDELL ASSET MANAGEMENT CORP. (COLLECTIVELY WITH THE FUNDS AND ACCOUNTS
 UNDER ITS MANAGEMENT, THE "SANDELL GROUP"), AND ARE BASED ON PUBLICLY
 AVAILABLE INFORMATION WITH RESPECT TO INFOSPACE, INC. (THE "ISSUER").
     EXCEPT FOR THE HISTORICAL INFORMATION CONTAINED HEREIN, THE MATTERS
 ADDRESSED IN THIS PRESS RELEASE ARE FORWARD-LOOKING STATEMENTS THAT INVOLVE
 CERTAIN RISKS AND UNCERTAINTIES. YOU SHOULD BE AWARE THAT ACTUAL RESULTS
 COULD DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-LOOKING
 STATEMENTS. THE SANDELL GROUP ASSUMES NO OBLIGATION TO UPDATE THE FORWARD-
 LOOKING INFORMATION.
     MEMBERS OF THE SANDELL GROUP RESERVE THE RIGHT TO CHANGE ANY OF THEIR
 OPINIONS EXPRESSED HEREIN AT ANY TIME, AS THEY DEEM APPROPRIATE. THE
 SANDELL GROUP DISCLAIMS ANY OBLIGATION TO UPDATE THE INFORMATION CONTAINED
 HEREIN.
     THIS PRESS RELEASE DOES NOT RECOMMEND THE PURCHASE OR SALE OF ANY
 SECURITY. UNDER NO CIRCUMSTANCES IS THIS PRESS RELEASE TO BE USED OR
 CONSIDERED AS AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
 SECURITY. MEMBERS OF THE SANDELL GROUP CURRENTLY OWN AN AGGREGATE OF
 APPROXIMATELY 8.8% OF THE OUTSTANDING COMMON STOCK OF THE ISSUER. THE
 SANDELL GROUP INCLUDES FUNDS AND ACCOUNTS THAT ARE IN THE BUSINESS OF
 TRADING - BUYING AND SELLING - PUBLIC SECURITIES. IT IS POSSIBLE THAT THERE
 WILL BE DEVELOPMENTS IN THE FUTURE THAT CAUSE ONE OR MORE MEMBERS OF THE
 SANDELL GROUP FROM TIME TO TIME TO SELL ALL OR A PORTION OF THEIR SHARES IN
 OPEN MARKET TRANSACTIONS OR OTHERWISE (INCLUDING VIA SHORT SALES), BUY
 ADDITIONAL SHARES (IN OPEN MARKET OR PRIVATELY NEGOTIATED TRANSACTIONS OR
 OTHERWISE), OR TRADE IN OPTIONS, PUTS, CALLS OR OTHER DERIVATIVE
 INSTRUMENTS RELATING TO SUCH SHARES.
     SANDELL ASSET MANAGEMENT CORP. AND CERTAIN OF ITS AFFILIATES AND
 NOMINEES (COLLECTIVELY, THE "PARTICIPANTS") FILED A PRELIMINARY PROXY
 STATEMENT WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 16, 2006
 RELATING TO THEIR SOLICITATION OF PROXIES FROM THE SHAREHOLDERS OF THE
 ISSUER WITH RESPECT TO THE 2007 ANNUAL MEETING OF SHAREHOLDERS. THE
 PRELIMINARY PROXY STATEMENT CONTAINS DETAILED INFORMATION REGARDING THE
 NAMES, AFFILIATIONS AND INTERESTS OF PERSONS WHO MAY BE DEEMED PARTICIPANTS
 IN THE SOLICITATION OF PROXIES. THE SANDELL GROUP INTENDS TO FILE A
 DEFINITIVE PROXY STATEMENT AND OTHER RELEVANT DOCUMENTS WITH THE SECURITIES
 AND EXCHANGE COMMISSION.
     SECURITY HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT AND OTHER
 DOCUMENTS RELATED TO THE SOLICITATION OF PROXIES BY THE PARTICIPANTS FROM
 THE SHAREHOLDERS OF THE ISSUER FOR USE AT THE 2007 ANNUAL MEETING OF
 SHAREHOLDERS OF THE ISSUER WHEN AND IF COMPLETED BECAUSE THEY WILL CONTAIN
 IMPORTANT INFORMATION. WHEN AND IF COMPLETED, A DEFINITIVE PROXY STATEMENT
 AND FORM OF PROXY WILL BE MAILED TO SHAREHOLDERS OF THE ISSUER AND WILL,
 ALONG WITH OTHER RELEVANT DOCUMENTS, BE AVAILABLE AT NO CHARGE AT THE
 SECURITIES AND EXCHANGE COMMISSION'S WEBSITE AT HTTP://WWW.SEC.GOV OR BY
 CONTACTING MACKENZIE PARTNERS BY TELEPHONE AT 1-800-322-2885 OR BY E-MAIL
 AT PROXY@MACKENZIEPARTNERS.COM.
 
 

SOURCE Sandell Asset Management Corp.

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