Concerned Shareholder Group Urges the Board of Directors of Hippo Holdings Inc. to Initiate a Strategic Review Following a Period of Significant Value Destruction

Rhea-AI Summary

Hippo Holdings Inc. faces concerns from a group of shareholders who hold nearly 2.5% of the outstanding common shares. The shareholders criticize the company's financial performance and urge the Board to run a strategic review process to preserve and maximize value. They suggest enhancing financial disclosures and electing an insurance industry veteran as independent Chair of the Board. The shareholders believe that taking the right steps could potentially return $15-$20 per share in value.

Positive

• Shareholders suggest running a strategic review process to preserve and maximize value, potentially returning $15-$20 per share in value

Negative

• Shareholders criticize Hippo's abysmal financial results and unsustainable operations, trading at a roughly 50% discount to book value

HOUSTON--(BUSINESS WIRE)-- Bradley L. Radoff and Etude Capital LLC (together with their affiliates, the “Concerned Shareholder Group” or “we”), who are among the Company’s 10 largest shareholders and hold nearly 2.5% of the outstanding common shares of Hippo Holdings Inc. (NYSE: HIPO) (“Hippo” or the “Company”), today issued the following open letter to the Company’s Board of Directors (the “Board”):

Members of the Board,

Since becoming a publicly traded entity in early 2021, Hippo has generated abysmal financial results and operated in an unsustainable manner. Hippo is now a micro-cap stock that trades at a roughly 50% discount to book value. We believe the Board must immediately embrace its fiduciary duty to preserve shareholder value while navigating a highly regulated industry.

We contend the only viable path forward is for the Board to immediately announce and run a strategic review process with the goal of preserving and maximizing value from the Company’s capital, Spinnaker Insurance Company and NOLs. Additionally, the Company should take immediate steps to enhance its financial disclosures so that shareholders can hold the Board and management accountable. The Company should cease giving meaningless non-GAAP guidance, like adjusted EBITDA, and focus on metrics that are critical to success as an insurer, such as book value and net income.

Taking the right and necessary steps, in our view, could return $15-$20 in per share value. To ensure an objective review is run and to help improve governance going forward, we urge you to elect insurance industry veteran Jay Nichols Jr. as independent Chair of the Board. We believe Mr. Nichols’s successful experience leading insurance company strategic actions and exits will inure to the benefit of the Company and its shareholders.

We expect the Board to address our concerns and move quickly to take the right steps. There is no excuse for exposing Hippo stakeholders to more risk and uncertainty. The Concerned Shareholder Group will seek to hold you accountable if no value-enhancing actions are taken.

Sincerely,

Bradley L. Radoff								Steven Stein
								Etude Capital LLC

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230914609056/en/

Greg Lempel

greg@fondrenlp.com

Source: Concerned Shareholder Group of Hippo Holdings Inc.