Engine Capital Delivers Letter to Navigant Board of Directors
Believes Navigant is Significantly Undervalued and That There are Opportunities Within the Board's Control to Increase Shareholder Value
Urges the Board to Either Immediately Make the Necessary Changes to Improve Navigant's Performance or Evaluate All Strategic Alternatives to Maximize Shareholder Value
Disappointed by the Board's Response to Engine's Constructive Efforts to Collaborate on Board Refreshment
Intends to Nominate Director Candidates for Election at Navigant's 2018 Annual Meeting
NEW YORK, Jan. 24, 2018 /PRNewswire/ -- Engine Capital LP (together with its affiliates, "Engine"), a shareholder of Navigant Consulting, Inc. ("NCI" or the "Company") (NYSE: NCI), with ownership of approximately 4.4% of the outstanding shares of the Company, today announced that it has delivered a letter to Navigant's Board of Directors.
Engine believes NCI is a good business with a strong brand, an attractive long-term growth profile, a growing base of recurrent revenue, and significant free cash flow generation. However, despite these attractive features, the Company trades at a very low absolute and relative valuation, with NCI trading at approximately 6.9x 2018E EBITDA1. Additionally, NCI's total shareholder return has lagged its peers as well as every relevant index over the last one, three and five-year timeframe.
Engine believes two avenues exist for the Board to significantly increase shareholder value. One option is for NCI to remain a standalone public company, but with an intense focus on improving its margins, reducing its working capital, reducing its capital expenditures, optimizing its balance sheet and capital allocation, aligning executive compensation with the most relevant metrics for shareholder value creation and strengthening its corporate governance and board composition. The other option is to initiate a review of the Company's strategic alternatives and explore what buyers may be willing to pay for NCI in the current robust M&A market. Engine believes that both paths would lead to significant shareholder value creation.
Over the last couple of months, Engine has engaged in a dialogue with the Board and management regarding these topics and was hoping to reach an amicable resolution regarding a Board refreshment. Given the Company's unwillingness to discuss a framework to achieve that objective, we have decided to publicly outline our views on NCI and the significant opportunities for value creation. It is Engine's current intention to nominate director candidates at Navigant's 2018 Annual Meeting.
Please click the following link to access the full letter: https://mma.prnewswire.com/media/632718/Engine_Letter_to_NCI_Board.pdf
ABOUT ENGINE CAPITAL
Engine Capital is a value-oriented special situations fund that invests both actively and passively in companies undergoing change.
Investor contact:
Engine Capital, L.P.
Arnaud Ajdler
(212) 321-0048
[email protected]
1 Assumes 2018 EBITDA of $146.5 million and Q4 free cash flow generation of $70 million including working capital normalization
SOURCE Engine Capital LP
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