Maguire Asset Management & Others Go Active On iPass Inc. by Activist Stocks
A collective of activist investors have teamed up to take on iPass, the sub $100 million market cap Wi-Fi roaming company. The group is calling themselves the iPass Shareholders for Change, owning 7.7% collectively and nominating five members for the board. Of them, is Hedge Fund Solutions’ Damien Park, CEO of Ethos Management Ken Traub and MD of Zuma Capital Brent Morrison. The biggest shareholder is Maguire Asset Management with a 5% stake. Others include Zuma Capital, Foxhill Capital, Catalysis Partners and Francis Capital.
These guys believe that the gross underperformance of the company (where it’s off 90% since its 2003 IPO) is the direct result of the incompetence of the board. Here are the key takeaways of the letter released today:
There’s been multiple (failed) attempts to sell the company over the last seven years. During that time, the company has changed its business plan many times, leading to large a cash burn and losses.
Historically, the Chinese market has been relatively isolated from international investors, but much is changing there now, making China virtually impossible for the diversified investor to ignore. Earlier this year, CNBC pointed to signs that Chinese regulators may start easing up on their scrutiny of companies after months of clamping down on tech firms. That Read More
But there’s hope, as iPass is the world’s largest commercial WiFi network, having some 18 million access points in 120 countries. It’s an underappreciated business, it’s just lacking investor confidence, which an overhauled board could provide.