Shareholder Activism

Goodwood acquires significant ownership stakes in a limited number of companies that are undervalued. Market value dislocations may be temporarily mispriced for a variety of reasons, including perceived unfavorable industry conditions, poor business performance, and changes in management, reorganizations, or other external factors. These conditions can often result in good businesses that are available at depressed valuations.  

Positive Cooperation with Management and Board

The goal in each active investment is to work constructively with management and/or the company’s board to implement a strategy or strategies that maximize returns for all shareholders.

Non-Receptive Management and Board

Occasionally, if the company is wholly non-receptive to value enhancing strategies and we have significant support from fellow shareholders, the engagement moves into the public domain to become proxy contests with the goal of seeking to replace certain directors or potentially a full reconstitution of the company’s Board.

Previous Announced Active Investments

Ongoing:

  Company Initial Investment ActivistHold
Period(
yrs)

Commentary
Ram Power 2009 Current Investment(Now Polaris Infrastructure) -Legacy debenture position led to discussions surrounding possible recapitalization and engaged the Company’s project lenders to propose debt restructuring-Subsequent recapitalization of Holdco balance sheet and restructured Projectco debt

-Invested/raised C$74.4 million of fresh equity

-Appointed new Chief Executive Officer

 

Completed:

 Company Initial Investment ActivistHold
Period(
yrs)

Commentary
logo-ats 2006 10.5 -Worked with management on a rights-offering funded capital raising for subsidiary

-Concern remained about incumbent management

-Launched successful proxy contest to replace board

-Hired new CEO and sold selected division’s/focused operations

logo-AandP 2002 6.8 -Nine letters to management/board

-Sold Canadian operations and implemented corporate changes

logo-creo 2002 2.9 -Numerous management and board requests to focus on maximizing profitability with cost cutting and/or strategic alternatives

-Proxy contest launched in 2004

-Sold to Eastman Kodak prior to proxy vote

logo-cenveo 2005 2.8 -Proxy contest launched in 2005 to replace board and bring in experienced management team

-Negotiated settlement to replace board and management

-Initiated cost cutting program and sale of selected subsidiaries

logo-petvalu 2006 3.1 -Concerned with management/board, business strategy and capex focus-Launched successful board replacement proxy contest and initiated new expansion strategies

-Sold to private equity buyer

2012 3.3 -Acquired Debentures after substantial declines in Company’s mostly junior resource portfolio

-Company breached indenture covenants

-Goodwood played supportive role in the restructuring which resulted in the appointment of three new Directors and a newly formed investment oversight committee in 2015

-Company reduced the aggregate principal amount of the outstanding debentures by approximately $20mm and announced an NCIB representing 10% of the remaining issue above our cost base

Webtech 2010 5.9

(Now BSM Technologies)

-Concerned with cost structure and management focus

-Launched successful board enhancement/replacement discussions with Company

-Company centralized operations and sold non-core businesses/value maximization ongoing

 Longford  2012 3.8

(Now Urthecast)

-Concerned with mgt/board pay-outs and investment strategy

-Launched successful board replacement proxy contest-Successfully invested/merged with Urthecast Corp

   2012 4.8

(Now Merus Labs International)

-Concerned with management/board payments and stagnant investment strategy

-Launched successful board/management replacement proxy contest

-Liquidating assets and considering new investments

-Successfully merged with Merus Labs International Inc

logo-westaim  2008  8.8 -Acquired position below liquidation value-Became management in 2009

-Large equity raise to acquire specialty insurance company and subsequently sold for meaningful gain

 

Principals of Goodwood Inc. may, from time to time, accept officer positions and/or directorships from and/or have other relationships with companies unrelated to Goodwood Inc. In this circumstance, that company would be considered under relevant securities law to be a “connected issuer” to Goodwood Inc.  Currently, Pediapharm Inc. is considered a “connected issuer” in respect of Goodwood Inc.  Furthermore, Goodwood Inc., or an affiliate of Goodwood Inc., may provide services to and receive compensation from issuers in which the Funds are invested.  Goodwood Management Services Ltd., an affiliate of Goodwood Inc., entered into a 5 year Consulting Agreement with Polaris Infrastructure Inc. (formerly Ram Power Corp) dated May 13, 2015; and, entered into a 4 year Consulting Agreement with Pediapharm Inc. dated October 16, 2018.  Goodwood Inc. has adopted appropriate policies and procedures to address conflicts of interest with respect to connected issuers.

Please click here for the Statement of Conflicts Policy.