Audley Capital Advisors, LLP is soliciting shareholder support of its bid to replace Jerry Kolb, Joseph Leonard, Bernard Rethore, Michael Tokarz and A.J. Wagner, representing five of the ten current members of the Walter Energy, Inc. board. In their stead, Audley has proposed the election of Edward Scholtz, Mark Lochtenberg, Robert Stan, Lawrence Clark, Jr. and Julian Treger. Audley also intends to support the remaining management nominees, being David Beatty, Mary Henderson, Patrick Kriegshauser, Graham Mascall and Walter Scheller.
Audley maintains that Walter Energy has lost an extraordinary amount of shareholder value over the last two years and underperformed U.S. coal industry peers and other benchmarks over that period. Audley believes mismanagement at the board level has left the Company saddled with an inappropriate and unsustainable debt load, an inefficient operating profile and underperforming assets. Audley believes immediate action is needed to reverse the Company’s poor performance and to reduce debt to a sustainable level. Audley proposes that the Company pursue alternative financing arrangements and the sale of non-core and underperforming assets and undertake a thorough review of the Company’s cost structure. On the call, Glass Lewis asks about the current contest, including the underpinnings of several key arguments and strategic initiatives for Walter Energy in the event the solicitation is successful.