Pirate takes aim at Angelica's adviser selection

By Lisa Kerner

Charlotte, N.C., July 18 - Angelica Corp. investor Pirate Capital LLC fired back at the company in another letter to the board, this time questioning the re-engagement of Morgan Joseph & Co. as Angelica's strategic adviser. The company, in a July 17 letter to Pirate, said it agreed to retain the adviser through June 30, 2008.

Pirate's letter was included as part of a schedule 13D filing with the Securities and Exchange Commission.

Thomas Hudson of Pirate said in the letter that Angelica's previous response to the shareholder was "every bit as opaque as the company's purported strategy for moving forward."

According to Pirate, Morgan Joseph has been leading Angelica's "recent failing corporate initiatives."

"Morgan Joseph has apparently been involved with the company almost 17 months, and it is not apparent to us that this engagement has done the company any good, and further not apparent that the engagement has moved the company any closer to a sale. So why extend the engagement, and muddle the firm's mandate with whatever else the firm has been doing for the company over the last 17 months?" Hudson wrote.

As previously reported, Pirate's July 12 letter to Angelica's board reiterated its demand that the board "promptly retain the services of a nationally recognized investment banking firm for the purpose of effecting a sale of the company, through sales of assets, an extraordinary transaction or otherwise, and to publicly identify the investment banking firm and its mandate."

The investor said if its demands are not met, it plans to nominate one or more people to Angelica's board.

Pirate currently owns 935,147 shares, or 9.8%, of Angelica's outstanding stock.

Angelica is a Chesterfield, Mo.-based provider of textile rental and linen management services principally to the health care industry.

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