Engine Capital Issues Statement Regarding Efforts to Drive Boardroom Change at Blucora

Rhea-AI Summary

Engine Capital LP has withdrawn its nominations for election to Blucora's Board of Directors at the upcoming Annual Meeting. The firm expressed optimism over recent appointments, specifically cybersecurity expert Kanayalal Kotecha and investment banker J. Richard Leaman III, highlighting their potential to address Blucora's underperformance and corporate overhead issues. Engine believes the company trades at a significant discount and will allow the new Board ten months to improve shareholder value before considering further actions at the 2023 Annual Meeting.

Positive

• Appointment of Kanayalal Kotecha and J. Richard Leaman III may enhance Board expertise.
• Engine Capital shows optimism in addressing long-standing corporate issues.
• Potential for value realization as Blucora reportedly trades at a substantial discount.

Negative

• Engine Capital expresses disappointment over the Board's historic resistance to shareholder representation.
• Concerns about Blucora's failed synergy-focused strategy and high corporate overhead remain.

NEW YORK--(BUSINESS WIRE)-- Engine Capital LP (together with its affiliates, “Engine” or “we") today announced that it has withdrawn its nomination of candidates for election to Blucora, Inc.’s (NASDAQ: BCOR) (“Blucora” or the “Company”) Board of Directors (the “Board”) at the upcoming Annual Meeting of Shareholders (the “Annual Meeting”). Engine believes the recent appointments of cybersecurity expert Kanayalal A. Kotecha and former investment banker J. Richard Leaman III represent a step in the right direction, especially given our publicly articulated concerns about the Company’s strategy and corporate structure. While Engine is disappointed with the Board’s yearslong resistance to adding a shareholder representative with financial expertise, we are hopeful that the addition of Mr. Leaman III as a director will help address Blucora’s failed “synergy-focused” strategy, excessive corporate overhead and sustained underperformance. Given his experience, we expect Mr. Leaman III will quickly identify that Blucora trades at a significant discount to the sum-of-the-parts and recognize the need to consider steps to close the valuation gap. Given our extensive engagement with leadership and these subsequent changes at Blucora, Engine will give the reconstituted Board ten months to address long-standing issues and unlock value for shareholders. Engine intends to continue engaging with the Board and absent enhanced value creation in 2022, we may seek meaningful change at Blucora’s 2023 Annual Meeting of Shareholders.

About Engine Capital

Engine Capital LP is a value-oriented special situations fund that invests both actively and passively in companies undergoing change.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220315006286/en/

Longacre Square Partners

Charlotte Kiaie, 646-386-0091

ckiaie@longacresquare.com

Source: Engine Capital LP

FAQ

What recent changes has Engine Capital announced regarding Blucora's Board of Directors?

Engine Capital has withdrawn its nominations for Blucora's Board but supports the recent appointments of Kanayalal Kotecha and J. Richard Leaman III.

What are Engine Capital's concerns about Blucora's strategy?

Engine Capital is concerned about Blucora's failed synergy-focused strategy and excessive corporate overhead.

How long will Engine Capital wait for improvements at Blucora?

Engine Capital will give the reconstituted Board ten months to address issues and unlock shareholder value.

What actions may Engine Capital take if Blucora does not enhance value in 2022?

Engine Capital may seek meaningful changes at Blucora's 2023 Annual Meeting of Shareholders.