Thunderbird Responds — Voss Capital’s Refusal to Engage Risks Significant Value Destruction
Thunderbird Entertainment Group (TSXV: TBRD, OTCQX: THBRF) addressed a proxy fight initiated by Texas-based Voss Capital, emphasizing its commitment to shareholder value and avoiding a costly dispute. The company highlighted a 25% revenue increase in Q1 and 83% growth from fiscal 2020 to 2022, alongside a 30% rise in adjusted EBITDA. Thunderbird remains profitable and cash flow positive, countering Voss's claims of inadequate value creation. Additionally, it noted the challenging equity market and potential obstacles in engaging foreign bidders due to Canadian cultural approval requirements.
- 25% revenue increase in Q1 2022.
- 83% revenue growth from fiscal 2020 to 2022.
- 30% rise in adjusted EBITDA.
- The company is profitable and cash flow positive.
- No debt and organic growth.
- Proxy fight could distract management and unsettle stakeholders.
- Difficult equity market may impact strategic transactions.
- Unpredictable Canadian government cultural approvals for foreign bidders.
Thunderbird hoped to avoid a distracting and value-destructive proxy fight
Over the last several weeks, Thunderbird engaged privately with Voss to avert an ugly, costly fight that will negatively impact all stakeholders. A proxy fight will be distracting to management, unsettling to the team, and could create unrest with buyers and customers. This, at a time when the Company is firing on all cylinders, including many exciting developments in owned-IP and several pending series renewals across all divisions. Thunderbird came to the table in good faith, attempting to find common ground. Unfortunately, Voss has chosen not to meaningfully engage and has now declared that we are at an impasse.
The equity markets are difficult now
Thunderbird is constantly checking the market (buy- and sell-side) including through engagement with potential financiers (debt and equity), investment banks, private equity funds and potential strategic and synergistic partners. The equity markets are difficult now, but it won’t last forever. Thunderbird remains a very profitable, cash flow positive and growing company, and the fact that the markets are unstable, alone, is a good reason not to push for a transformative transaction which will almost certainly fail. In addition, the Company is aware of several failed sales processes for similarly sized companies in its industry in the last several months alone.
As the Company has stated previously, the pool of Canadian bidders is small and non-Canadians would be subject to Canadian Government cultural approval. Such approval is unpredictable and could be subject to time-consuming and expensive undertakings, which could further restrict the pool of interested parties and diminish the price offered to Thunderbird shareholders.
Voss is wrong to complain about Thunderbird’s value-creation strategy
Voss’s
Moreover, Voss omitted appropriate context with its criticism of Thunderbird’s share price performance. Voss ignored clear evidence that Thunderbird shares have outperformed directly comparable peers as well as the market.
Thunderbird will file and mail its Circular in due course, after which it will commence soliciting proxies for its nominees. The Circular will be posted at investors.thunderbird.tv and under Thunderbird's profile on SEDAR at www.sedar.com.
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Cautionary Statement Regarding Forward-Looking Information
This news release includes certain “forward-looking statements” under applicable Canadian securities legislation that are not historical facts. Forward-looking statements involve risks, uncertainties, and other factors that could cause actual results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements in this news release include, but are not limited to, statements with respect to the nature, cost and impact of a proxy fight on Company stakeholders; the future state of the equity markets; the likelihood that a transformative transaction would fail; Canadian Government cultural approval requirements for a transformative transaction; timing for filing and mailing the Circular; timing for soliciting proxies for management nominees; the Company’s objectives, goals or future plans; and the business and operations of the Company. Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic and social uncertainties; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; and those additional risks set out in the Company’s management’s discussion and analysis for the years ended
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View source version on businesswire.com: https://www.businesswire.com/news/home/20221207005649/en/
Investor Relations Contacts:
Phone: + 1 905 326 1888 ext 1
Email: glen@bristolir.com
Media Relations Contact:
Phone: 416-219-3769
Email: lcastleman@thunderbird.tv
Corporate Communications
Email: Julia@finchmedia.net
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