公司:
Quotient Technology, Inc. (QUOT) 业务： Quotient Technology 是一家数字媒体和促销技术公司，为品牌和零售商提供强大的集成数字媒体和促销计划。该公司通过两个部门运营：(i) 促销部门，提供数字优惠券；(ii) 数字媒体部门，为客户提供有针对性的广告。该公司利用行业领先的技术构建了一些最有价值的客户购物数据洞察，使其能够与 800 多家消费品 (CPG) 公司和许多顶级零售商有效合作。
股票市值：6.892 亿美元（每股 7.30 美元）
活动家：Engaged Capital
持股比例：6.47%
平均成本：6.46 美元
激进主义评论：Engaged Capital 由 Relational Investors 的前任负责人和董事总经理 Glenn W. Welling 创立。 Engaged 是一位经验丰富且成功的小盘投资者，投资期限为两到五年。它的风格是让管理层和董事会闭门负责。自 2020 年底以来，Engaged 一直是 Quotient 的投资者，在股价飙升时获利了结，在股价回落时买入更多。
发生了什么？
2021 年 11 月 17 日，Engaged 致函董事会，强调该公司相对于同行表现不佳、公司治理实践不佳和运营问题。此外，Engaged 要求豁免公司最近宣布的税收优惠保全计划，如果股东获得超过 4.9% 的实益所有权，该计划就可以行使，以允许 Engaged 获得高达 9.99% 的实益所有权。
幕后花絮：
随着优惠券和广告继续从纸质转向数字化以及电子商务的扩张，这个行业正在经历明显的长期顺风。这些利好因素只会被 Covid 环境放大。然而，该公司的业绩一直不佳——在最近一个季度，该公司削减了指导，并报告称失去了其最大的合作伙伴之一 Albertsons。在过去四年中，该公司一直未能达到季度指导。因此，在过去五年中，该公司的表现比同行低 500% 以上，交易价格接近历史低点，并且在 1 年、3 年和 5 年期间的表现比标准普尔 500 指数低 -27.91% 、-112.25% 和 -152.87%。
Quotient 的问题与许多其他激进目标类似：它是一家仍由其创始人经营的上市公司，就像一家成本结构臃肿和公司治理糟糕的私营公司。公司治理不善的明显迹象都在那里——董事会交错、董事长/首席执行官合并、在无竞争的选举中投票多数等——所有这些都是大多数公司多年前废除的。然而，两个更明显的董事会根深蒂固的例子是 (i) 在 Engaged 购买其头寸的同时，该公司制定了 4.9% 的净营业亏损毒丸——商数一直有显着的 NOL，而且从未有过NOL 药丸，但突然觉得有必要在没有股东投票的情况下立即采取行动，同时一名激进分子出现； (ii) 通过将新董事归入一个直到 2024 年才能选举的类别，并将今年选举的董事人数从三名减少到两名，从而用新董事替换辞职的董事。良好的公司治理将要求尽快对新董事进行投票，特别是如果这并不意味着改变类别。除了使股东更难实质性地改变董事会的组成之外，没有其他理由进行这种变化。
这种糟糕的公司治理不仅仅是一个学术问题——它是股东的一个实际问题，因为它导致了领导问题、失败的继任计划和可怕的利润率。史蒂夫博尔是该公司的创始人、董事长/首席执行官，自 1998 年以来一直担任。博尔于 2017 年卸任首席执行官，但仍然担任董事长并在两年后重新担任首席执行官，从未真正让他的继任者米尔阿米尔担任公平的成功机会。通过所有这些，该公司比 2014 年的 IPO 价格下降了约 53%，并且引导 EBITDA 利润率为 7% 至 8%，而类似的 AdTech 业务的利润率为 35% 以上。
这里有两种创造股东价值的选择：(i) 引入一个具有深厚数字广告经验的新管理团队，为股东更有效地开展业务，或 (ii) 出售给具有管理团队的战略投资者，可以更好地管理这项业务 - 有传言称对该公司有兴趣，但管理层一直不愿参与。对于史蒂夫鲍尔来说，任何一个都不是一个好场景。
问题是，在今年只有两名董事参加选举的八人董事会中，您如何完成这些任务中的任何一项？嗯，有一种方法，Engaged 以前做过。 Engaged 在 2017 年在 Rent-A-Center 的激进活动中面临几乎一模一样的情况——创始人/董事长/首席执行官 Mark Speese 在 2014 年放弃了 CEO 的角色，保留了董事长的角色，并在三年后的 2017 年重新担任了 CEO 的角色. 同年，Engaged 向交错董事会提名了三名董事，赢得了代理权争夺战并罢免了三名现任董事，包括董事长/首席执行官马克·斯皮斯 (Mark Speese)。六个月后，Speese 辞去了 CEO 的职务。
有趣的是，在今年要在 Quotient 选举的两个席位中，其中一个是董事长/首席执行官史蒂夫博尔。您认为 Engaged 会犹豫是否遵循此处的 Rent-A-Center 手册？这些数字不言自明——在 Rent-A-Center 为期 4.5 年的激进活动中，Engaged 的回报率为 238.01%，而同期标准普尔 500 指数的回报率为 85.33%。综上所述，不言而喻，该公司不可能授予 Engaged 豁免以收购该公司最多 9.99% 的普通股。
Ken Squire 是 13D Monitor 的创始人兼总裁，这是一家关于股东激进主义的机构研究服务机构，也是 13D Activist Fund 的创始人和投资组合经理，这是一家投资于激进主义 13D 投资组合的共同基金。
Activist fund Engaged Capital may turn to a familiar strategy to boost performance at Quotient
Company: Quotient Technology, Inc. (QUOT)
Business: Quotient Technology operates as a digital media and promotions technology company that offers power integrated digital media and promotions programs for brands and retailers. The company operates through two segments: (i) Promotions segment, which offers digital coupons and (ii) Digital Media segment, which provides targeted ads to customers. The company has built some of the most valuable customer shopping data insights with industry leading technology, allowing it to effectively work with over 800 Consumer Packaged Goods (CPG) companies and many top retailers.
Stock Market Value: $689.2M ($7.30 per share)
Activist: Engaged Capital
Percentage Ownership: 6.47%
Average Cost: $6.46
Activist Commentary: Engaged Capital was founded by Glenn W. Welling, a former principal and managing director at Relational Investors. Engaged is an experienced and successful small cap investor and makes investments with a two-to-five-year investment horizon. Its style is holding managements and boards accountable behind closed doors. Engaged has been an investor in Quotient since the end of 2020, taking profits when the stock has soared and buying more when it dropped back down.
What's Happening?
On Nov. 17, 2021, Engaged sent a letter to the board highlighting the company's relative underperformance to peers, poor corporate governance practices and operating issues. Additionally, Engaged requested an exemption from the company's recently announced tax benefits preservation plan, which becomes exercisable if a shareholder acquires beneficial ownership above 4.9%, to allow Engaged to acquire beneficial ownership up to 9.99%.
Behind the Scenes:
This is an industry that is experiencing obvious secular tailwinds as coupons and advertising continues to shift from paper to digital and as e-commerce expands. These tailwinds have only been magnified by the Covid environment. However, the company has had consistently poor performance — in the most recent quarter, the company cut its guidance and reported losing one of its largest partners, Albertsons. Over the past four years, the company has consistently missed meeting quarterly guidance. As a result, over the past five years, the company has underperformed peers by over 500%, is trading close to all-time lows and has underperformed the S&P 500 on 1-, 3-, and 5-year periods by -27.91%, -112.25% and -152.87%, respectively.
The problem with Quotient is similar to many other activist targets: It is a public company still being run by its founder like a private company with a bloated cost structure and horrendous corporate governance. The obvious signs of poor corporate governance are all there – staggered board, combined chairman/CEO, plurality voting in uncontested elections, etc. – all things that most companies have done away with years ago. However, the two more blatant examples of an entrenched board are (i) the company instituting a 4.9% net-operating-loss poison pill at the same time that Engaged is buying its position – Quotient has always had significant NOLs and has never had an NOL pill, but suddenly feels the need for one immediately without a shareholder vote the same time an activist shows up; and (ii) replacing a resigning director with a new director by putting the new director in a class that is not up for election until 2024 and decreasing the number of directors up for election this year from three to two. Good corporate governance would dictate that the new director is voted on as soon as possible, particularly if it does not mean changing the class. There is no reason for this change other than to make it harder for shareholders to materially change the composition of the board.
This bad corporate governance is not just an academic issue – it is a practical issue for shareholders as it has led to a leadership issue, a failed succession plan and horrible margins. Steve Boal is the founder, chairman/CEO of the company and has been since 1998. Boal stepped away as CEO in 2017 but remained chairman and took the reins back as CEO just two years later, never really giving his replacement, Mir Aamir, a fair chance at success. Through all of this, the company is down about 53% from its 2014 IPO price and is guiding EBITDA margins of 7% to 8% versus 35%+ margins for similar AdTech businesses.
There are two options here to create shareholder value: (i) bring in a new management team with deep digital ad experience to run the business more efficiently for shareholders, or (ii) sell to a strategic investor with a management team that can better manage this business – it has been rumored that there has been interest in the company but management has been unwilling to engage. Either one is not a good scenario for Steve Boal.
The question is how do you accomplish either of those tasks with an eight-person entrenched board with only two directors up for election this year? Well, there is a way, and Engaged has done it before. Engaged faced almost the exact situation in its 2017 activist campaign at Rent-A-Center – founder/chairman/CEO Mark Speese gave up the role as CEO in 2014, retained the role of chairman and took back the CEO role three years later in 2017. Engaged nominated a full slate of three directors to the staggered board that same year, won the proxy fight and removed three incumbent directors, including chairman/CEO Mark Speese. Six months later, Speese resigned as CEO.
Interestingly, of the two seats up for election at Quotient this year, one of them is chairman/CEO Steve Boal. Do you think Engaged will hesitate to follow the Rent-A-Center playbook here? The numbers speak for themselves – over its 4½-year activist campaign at Rent-A-Center, Engaged made a 238.01% return versus 85.33% for the S&P 500 over the same time period. Having said all of this, it goes without saying that there is no chance that the company grants Engaged an exemption to acquire up to 9.99% of the company's common stock.
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments.
