Starboard Delivers Open Letter To Box Stockholders
Starboard Value LP, a significant investor in Box, Inc. (NYSE: BOX) with an 8.8% stake, has issued an open letter to Box stockholders emphasizing the need for enhanced governance and operational improvements. Starboard highlights its efforts over the past two years, leading to profitability improvements and a 71% increase in stock price since its 2019 Schedule 13D filing. Despite some positive changes, Starboard expresses disappointment regarding the recent election outcomes and stresses the need for strong commitment from Box's Board to realize further enhancements and shareholder value.
- Box's stock price increased by 71% since Starboard's Schedule 13D filing in September 2019.
- Mild improvements in growth trends and increased profitability compared to before Starboard's involvement.
- Box has appointed an independent Chair of the Board and removed the problematic supermajority voting requirement.
- Starboard expressed disappointment with recent election results influenced by preferred equity financing and aggressive share repurchases.
- Serious issues remain that need to be addressed by Box's Board.
NEW YORK, Sept. 9, 2021 /PRNewswire/ -- Starboard Value LP (together with its affiliates, "Starboard" or "we"), one of the largest stockholders of Box, Inc. ("Box" or the "Company") (NYSE: BOX), with an ownership stake of approximately
The full text of Starboard's open letter to Box stockholders follows and can also be viewed at the following link:
A LETTER TO THE STOCKHOLDERS OF BOX, INC.
September 9, 2021
Dear Fellow Stockholders,
As you know, Starboard Value LP (together with its affiliates, "Starboard" or "we") is one of the largest stockholders of Box, Inc. ("Box" or the "Company"), with an ownership stake of approximately
We invested in Box more than two years ago based on our view that the Company could significantly improve its performance and create substantial value after years of underperformance. From the outset, our only goal has been to help Box create long-term value for the benefit of all stockholders. We have pushed the Company to improve operations, corporate governance, executive compensation practices, and capital allocation with the goal of driving improved stockholder returns.
After failing to address issues in these areas prior to our involvement, some progress has been made under immense pressure from Starboard and other common stockholders over the past two years. During this campaign, independent proxy advisory firms Institutional Shareholder Services Inc., Glass, Lewis & Co., and Egan-Jones Proxy Services have all recognized our involvement as the key driver of the positive changes that have taken place at Box over the past two years.
Today, the Company is seeing mild improvements in growth trends and is significantly more profitable than it was prior to our involvement. Additionally, during the pendency of this election contest, Box has taken actions to appoint an independent Chair of the Board of Directors (the "Board") and remove the highly problematic supermajority voting requirement to amend the Charter and Bylaws, while committing to several other governance and compensation program enhancements. Although there is significantly more to be accomplished and serious issues still exist, these are positive steps. As a result, Box's stock price has increased by
We are certainly disappointed by the results of this election, which were heavily skewed by the voting rights tied to the preferred equity financing and the use of stockholder capital to aggressively repurchase shares ahead of the record date from stockholders likely to support change. At this juncture, the future of Box is in the Board's hands, and there is a significant amount of work left to be done. Many commitments have been made, and we hope that Box will finally be able to follow through on its promises to drive improved results, accountability, governance, and compensation practices.
As this campaign concludes, we are appreciative of the support received from our fellow stockholders. As we have repeatedly stated, our only goal has been to help Box perform better and adopt best-in-class practices across operating performance, financial results, governance, and compensation in order to create long-term value for the benefit of all stockholders. We will continue to monitor progress at Box, and we hope to see the Company embrace the changes catalyzed by our involvement and create long-term value.
Respectfully,
Peter A. Feld
Managing Member
Starboard Value LP
About Starboard Value LP
Starboard Value LP is a New York-based investment adviser with a focused and differentiated fundamental approach to investing primarily in publicly traded U.S. companies. Starboard seeks to invest in deeply undervalued companies and actively engage with management teams and boards of directors to identify and execute on opportunities to unlock value for the benefit of all shareholders.
Investor contacts:
box@starboardvalue.com
www.starboardvalue.com
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1 Source: Capital IQ. Stock price performance represents performance from September 2, 2019, the day prior to the Schedule 13D filing to September 8, 2021.
2 Source: Capital IQ. Stock price performance prior to Schedule 13D filing represents performance from January 23, 2015, the day following Box's IPO to September 2, 2019.
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SOURCE Starboard Value LP
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