Riposte Capital Calls for New, Independent Directors at SilverBow Resources
- None.
- The Board is criticized for pursuing dilutive transactions and maintaining the industry's only poison pill, which has been widely criticized by investors and corporate governance advisory firms. SilverBow's share price has significantly decreased following a 'transformational' acquisition of Chesapeake's South Texas position, causing a 23% decrease. The company's valuation discount has increased to approximately 50% vs. the peer group, and the sector multiple currently sits at 3X, whereas SilverBow sits at just 2X 2024 EV / EBITDA.
Current Board has proven itself incapable of being credible stewards of capital or proper corporate governance
SilverBow trades at a
***
SilverBow Resources, Inc.
920 Memorial City Way, Suite 850
Attention: Board of Directors
Dear Sean and Members of the Board,
As significant and constructive shareholders of SilverBow Resources, Inc. (NYSE: SBOW), owning approximately
You have proven yourselves incapable of being credible stewards of capital or corporate governance. It is clear to us, and likely many others in the investment community, that you have no interest in enabling shareholders to exercise their right to participate in the strategic decision-making process. You also appear to have no intention of engaging in good faith discussions with potential suitors.
On June 14, 2023, as one of the largest shareholders in SilverBow, we called on you to take decisive and common sense actions to unlock shareholder value, positioning the Company for long term success. Regrettably, you chose a different path – one that has eroded hundreds of millions of dollars in shareholder capital, while further siloing and backing the Company into a corner.
You have continued to pursue a value destructive strategy, which has:
- Further entrenched the Board;
- Significantly depressed SilverBow's share price;
- Widened the Company's already material peer group discount;
- Added significant debt to an already fragile balance sheet; and
- Made the Company less attractive to potential acquirers.
When we wrote to you in June, your stock price was languishing and meaningfully underperforming relevant indices and peers. SilverBow traded at a
We specifically advised you to avoid dilutive acquisitions given your lack of scale, financial profile and modestly valued equity. However, a mere two months after our public letter you went ahead and made a
Your "transformational" acquisition destroyed much of the value that had accrued to the Company following our open letter and a rise in commodity prices. Notably, because of your poor financial profile, you were compelled to issue fresh equity,
It has become clear that you have done everything within your power to deter potential acquirers of the Company in the midst of an ongoing wave of logical consolidation that is unfolding across your peer groups' ecosystem. Why else would you maintain the dubious distinction of being the only public E&P company with a poison pill? The existence of this pill has been widely criticized by both investors and Institutional Shareholder Services, a leading proxy and corporate governance advisory firm.
In the face of your complete absence to either engage with us as a material shareholder, or to pursue a strategy that creates value for your investors, we have concluded that in order for the best interests of the Company to be served, the composition of your Board must be materially altered at the 2024 annual meeting of shareholders.
Three new and independent candidates must be nominated and elected by shareholders – the true owners of SilverBow. Riposte is keen to support or put forward such independent nominees.
Sincerely,
/s/ Khaled Beydoun
Riposte Capital
About Riposte Capital
Riposte Capital is an SEC Registered Investment Advisor based in New York City. The equity strategy was launched in 2013 and is primarily focused on cyclical industries.
Riposte Contact:
Jeremy Goodman
Head of Business Development
+44 (0) 7788 567 913
jg@ripostecapital.com
Media Contact:
Ross Lovern
Kekst CNC
212.521.4800
ross.lovern@kekstcnc.com
View original content:https://www.prnewswire.com/news-releases/riposte-capital-calls-for-new-independent-directors-at-silverbow-resources-302001439.html
SOURCE Riposte Capital
FAQ
What is the current stock price of SilverBow Resources, Inc. (NYSE: SBOW)?
Why is Riposte Capital LLC expressing concerns about SilverBow's Board of Directors?
What action does Riposte Capital LLC call for in their letter to SilverBow's Board of Directors?
What was the impact of SilverBow's 'transformational' acquisition of Chesapeake's South Texas position?
