Liquor Stores N.A. Ltd. Highlights Serious Flaws in PointNorth's Analysis and Strategy
Recommends Shareholders Vote the White Proxy in Support of Incumbent Board
(firmenpresse) - EDMONTON, ALBERTA -- (Marketwired) -- 05/18/17 -- Liquor Stores N.A. Ltd. (the "Company" or "Liquor Stores") (TSX: LIQ), North America's largest publicly traded liquor retailer, today highlighted a number of serious flaws in the analysis and strategy of activist shareholder PointNorth Capital.
Liquor Stores' comments follow a preliminary review of PointNorth's dissident circular. PointNorth, a recent 9.7% shareholder of the Company, launched a costly and distracting proxy battle for control of the Board just weeks after rejecting an offer from Liquor Stores for two board seats.
Jim Dinning, Chairman of the Board of Liquor Stores, commented, "Over the past six months, we repeatedly asked PointNorth to share its advice and constructive criticisms so we could either use its insights to improve our operations or help it to better understand our business. PointNorth consistently declined to share its thinking."
"Now we know why: PointNorth's analysis is riddled with flaws," said Mr. Dinning. "The biggest flaw is its assumption that what might have worked in government-controlled provincial monopolies, that by definition have no competitors, would work in our six highly competitive markets. Government monopolies control both wholesale and retail operations, set prices and adjust margins at will without having to compete with discounters - or anyone, for that matter."
Applying a monopoly business strategy to Liquor Stores will erode gross margin and is doomed to fail. Customers don't go to monopolies because they want to. They go because they have no other choice. This flawed analysis is a product of PointNorth's decision to delegate the development of its proposed "New Strategy" for Liquor Stores to two of their nominees, Stephen Barbet and Richard Perkins, both of whom are former executives of Nova Scotia's government-run liquor monopoly. As far as Liquor Stores is aware, neither PointNorth nor its nominees have in-depth experience in the highly competitive liquor retailing sector in which the Company operates.
"Shareholders only have to look at the track records of PointNorth's principals to see the value destruction that occurs from a defective strategy. We urge Liquor Stores shareholders to bear that in mind as they evaluate PointNorth's faulty analysis, misleading claims and wishful thinking. Don't let Liquor Stores suffer the same fate as SiriusXM, Priszm, KEYreit and Mobilicity."
In due course Liquor Stores will provide a detailed review of the serious flaws in PointNorth's analysis. For now, Liquor Stores believes the following points serve as useful and troubling examples:
"The question is whether PointNorth truly doesn't understand our business, or is trying to mislead shareholders into giving up control by electing their majority slate," said Mr. Dinning. "Shareholders should stay tuned for further communications from us in the days ahead. This will come down to who you can trust to be good stewards of your investment."
Vote the WHITE proxy for Liquor Stores' nominees
Liquor Stores urges shareholders to read its Management Information Circular, available on the Liquor Stores website at and under the Liquor Stores profile at . The circular highlights the value creation initiatives undertaken by Liquor Stores and its Board over the past few years. The Circular also outlines the strategic importance of Liquor Stores' market diversification and work underway to improve inventory management to free up more cash flow to invest in the business.
Liquor Stores recommends that shareholders vote the WHITE proxy for the Board's eight experienced and qualified incumbent nominees. Vote today.
Meeting Details
The record date for the Annual Meeting was the close of business on April 21, 2017 (the "Record Date"). All registered shareholders of record as at the Record Date are invited to attend the Meeting which is taking place at Meeting Place 1 at the Hyatt Place Edmonton-West located at 18004 100 Ave NW, Edmonton, Alberta, on Tuesday, June 20, 2017, at 10:00 a.m. (Edmonton time). Shareholders are advised to vote only the WHITE form of proxy today, or no later than 10:00 a.m. (Mountain Time) or Noon (Eastern Time) on Friday, June 16, 2017.
If shareholders have any questions or require any assistance in executing your proxy or voting instruction form, please call D.F. King Canada at:
- North American Toll Free Number: 1-800-301-9627
- Outside North America, Banks, Brokers and Collect Calls: 1-201-806-7301
- Email:
- North American Toll Free Facsimile: 1-888-509-5907
- Facsimile: 1-647-351-3176
ABOUT LIQUOR STORES N.A. LTD.
The Company operates 252 retail liquor stores in Alberta, British Columbia, Alaska, Kentucky, New Jersey, and Connecticut. Liquor Stores' retail brands include: Liquor Depot, Liquor Barn, and Wine and Beyond in Alberta (178 stores); Liquor Depot and Liquor Barn in British Columbia (34 stores); Brown Jug in Alaska (22 stores); Liquor Barn "The Ultimate Party Source" and Liquor Barn Express in Kentucky (15 stores), Joe Canals Discount Outlet in New Jersey (2 stores), and LQR MKT in Connecticut (one store). The Company's common shares and convertible subordinated debentures trade on the Toronto Stock Exchange under the symbols "LIQ" and "LIQ.DB.B", respectively.
FORWARD-LOOKING STATEMENTS
This press release contains forward looking statements or information (collectively "forward-looking statements") within the meaning of the "safe harbour" provisions of applicable securities legislation. All statements and information other than statements of historical fact contained in this press release are forward-looking statements. In particular, this press release contains forward-looking statements with respect to: Liquor Stores' strategy, the implementation of our ERP system, and our continued regular examination of our U.S. business. Forward-looking statements reflect our current plans, intentions, and expectations, which are based on management's perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. Our plans, intentions, and expectations are inherently subject to significant business, economic, competitive and other uncertainties and contingencies regarding future events and as such, are subject to change. There is no assurance that the plans, intentions, or expectations upon which these forward-looking statements are based will occur. Forward-looking statements are subject to risks, uncertainties and assumptions, including, but not limited to, those discussed elsewhere in this press release and our other filings made with Canadian securities regulatory authorities and available on SEDAR at .
Although Management believes that the expectations represented in such forward-looking statements are reasonable there can be no assurance that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Some of the factors that could affect future results and could cause results to differ materially from those expressed in the forward-looking statements contained herein include, but are not limited to: risks relating to government regulation and changes thereto (whether by court decisions, citizen referenda, or otherwise); competition; the state of the economy including general economic conditions in Canada (including Alberta) and the U.S.; the unpredictability and volatility of Liquor Stores' common share price; restrictions on potential growth; availability of sufficient financial resources to fund the Company's capital expenditures; changes in commodity tax rates and government mark- ups; risks relating to future acquisitions and development of new stores; the ability of management to execute the Company's business and strategic plans; Liquor Stores' ability to locate and secure acceptable store sites and to adapt to changing market conditions; poor weather conditions; dependence on key personnel; labour costs, shortages and labour relations including Liquor Stores' ability to hire and retain staff at current wage levels and the risk of possible future unionization; supply interruption or delays; dependence on suppliers; reliance on information and control systems; income tax changes; leverage and restrictive covenants in agreements relating to current and future indebtedness of Liquor Stores; and credit risks arising from operations. These factors should not be construed as exhaustive. The information contained in this press release, and as disclosed in other filings made by the Company with Canadian securities regulatory authorities and available on SEDAR at , identifies additional factors that could affect the operating results and performance of Liquor Stores. Readers are cautioned that this list of risk factors should not be construed as exhaustive. The forward looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward looking statements included in this press release are made as of the date hereof and Liquor Stores assumes no obligation to update or revise them to reflect new events or circumstances except as expressly required by applicable securities law.
Contacts:
Investors
Liquor Stores N.A. Ltd.
Matthew Rudd
Senior Vice President and Chief Financial Officer
(780) 702-7389
Media
Longview Communications
Louise Kozier
(604) 694 6033
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Datum: 18.05.2017 - 12:04 Uhr
Sprache: Deutsch
News-ID 543584
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EDMONTON, ALBERTA
Kategorie:
Beverages
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