Report: Rimage CEO, Shareholders Differ on Strategy
Edina-based Rimage Corporation CEO Sherman Black is looking to reinvent the company and reduce its dependence on disk duplication, according to a recent report by the Star Tribune.
The Minneapolis newspaper reports that Black wants Rimage to start offering online cloud-computing services for customers in the disk market as demand slows for those types of products.
But stockholders aren't on board with Black's new strategy, according to the Star Tribune. Many of them are pushing for the company to distribute its cash-which totaled $109 million in March-to them in the form of a one-time dividend.
Earlier this year, Black rejected that plan, which was initiated by stockholder Henry Schacht of Notre Dame, Indiana, whose investment fund, Schacht Value Investors, holds less than 1 percent of Rimage stock, according to the Star Tribune.
Black reportedly responded to Schacht's plan-which suggested distributing $100 million to shareholders-by saying that the company will continue to shrink and won't have money left to expand if it doles out money to shareholders.
Click here to read more in the Star Tribune about Black's new strategy and why it concerns some analysts and shareholders.