Scrippps CEO Adam Symson last Friday appealed to employee-shareholders for their votes in a May 10 proxy showdown with investor Mario Gabelli, who wants to squeeze more cash flow out of the company by placing three experienced broadcast execs on the board — Colleen Brown, Vince Sadusky and Ray Cole.
Under mounting pressure from unhappy shareholder Mario Gabelli, Scripps CEO Adam Symson sent a letter to its employee-shareholders asking them to vote for “the company slate” of board members — Lauren Fine, former Gannett CEO Roger Ogden and Kim Williams.
Gabelli’s firm GAMCO has put up his own slate, challenging Symson’s leadership in the name of shareholder value. His slate comprises well-known broadcast executives: Fisher CEO Colleen Brown, Citadel CEO Ray Cole and former Media General CEO Vince Sadusky.
The votes will be counted May 10 at the shareholders’ meeting.
“When I became CEO in August, your leadership team put in place a strategy, backed by our board, that is delivering tangible results toward improving the company’s performance in order to best position us for the future,” Symson said in his letter.
“This plan is focused on new operating philosophies across our businesses that promote growth. At the same time, we have refined our local media acquisitions strategy to take advantage of new federal ownership rules.
“And we are investing in our fast-growing national media brands (the Katz networks, Newsy and Midroll) to fully capture their potential over the long term.
“We have gained significant momentum since implementing our strategy and are beginning to see the results. In fact, we continue to receive positive reviews of our plan from the investment analyst community.
“For the past 140 years, Scripps has been a financially sound company rooted in journalism. We have a mission to serve our audiences and advertisers with quality local and national news, information and entertainment. Having GAMCO’s nominees on our board would distract us both from our performance improvement plan and from this mission in which we all believe.”
“Scripps has a strong plan. We hope you will support us as we continue to execute it.”
Last Thursday, in a release and SEC filing, GAMCO campaigned for votes among all shareholders, arguing that new outside directors are needed “to help management increase intrinsic value.”
If the company could increase its broadcast cash flow by 600 basis points, it could create $500 million in value based on a 7X cash-flow multiple, it said.
“The improvement could boost the price of SSP shares, accelerate deleveraging and enhance the company’s currency for potential TV station M&A that could expand the scale of Scripps’ broadcast operations.”
GAMCO also scolded Scripps for paying its outside directors too much and for spending around $3 million on help in warding off GAMCO.