Ramius Value and Opportunity Advisors has delivered a letter to the board of directors of Extreme Networks expressing its concern regarding recent interaction with the company and calling for changes to the structure and composition of the board.
Ramius also questioned the timing of the recently announced amendment to the company’s rights plan purportedly designed to preserve net operating losses for future use.
Ramius Value and Opportunity Advisors own approximately 5.9 per cent of the outstanding shares of Extreme, making it one of the largest shareholders of the company.
The letter says that although the company has made some progress over the past year, Ramius believes there are substantial opportunities to unlock value at Extreme that have gone unrealised.
“The company continues to trade at a steep discount to intrinsic value. We believe prompt action is required by management and the board of directors to close this valuation gap,” the letter states.
Ramius believes the timing of the recent action to amend the company’s rights plan to prevent shareholders from acquiring greater than 4.95 per cent ownership of the common shares of Extreme raises serious questions as to the board’s true intentions.
