SurModics Shareholder Seeks Board Positions
SurModics, Inc.'s largest shareholder- Ramius Value and Opportunity Advisors, LLC-on Wednesday submitted a letter to the company's board nominating three directors that it says will assist in addressing the “long-term underperformance of SurModics' business and stock price.”
On news of the letter, SurModics' stock closed up more than 10 percent at $9.23 per share on Wednesday.
In the letter, which was filed with the U.S. Securities and Exchange Commission, Ramius said that the company's stock price has materially underperformed the market and has declined about 65 percent within the past year, 83 percent within the past three years, and 79 percent within the past five years.
“We believe this decline is, in large part, due to continued poor operating performance driven by failed growth investments, failed acquisitions, and excessive spending,” the letter stated.
Ramius said in the letter that its nominees have the necessary experience and desire to work with SurModics' management and the board to determine the right strategic direction for the company, including identifying and retaining a new CEO.
SurModics has had a tough year in 2010. For its fiscal year that ended on September 30, the company reported $69.9 million in revenue-down 42.5 percent from $121.5 million in revenue in the prior fiscal year.
The company recently reported a fourth-quarter loss of $21.7 million, or $1.25 per share, a substantial departure from the $2.7 million, or 16-cents-per-share, profit that the company posted in the same period last year.
In March, SurModics' CEO of five years, Bruce J. Barclay, resigned from the company in order to take the helm at Mountain View, California-based Hansen Medical, Inc. Last month, the company announced plans to reduce its workforce by 13 percent and also said it would reorganize into three business units-medical device, pharmaceuticals, and in vitro diagnostics.
SurModics, founded in 1979, provides drug-delivery and surface-modification technologies and in vitro diagnostic test kits to the health care industry.