Ryerson asks shareholders to reject Harbinger nominees on Aug. 23

By Lisa Kerner

Charlotte, N.C., Aug. 14 - Ryerson, Inc. urged its stockholders to reject Harbinger Capital Partners Master Fund I, Ltd. and Harbinger Capital Partners Special Situations Fund, LP's hand-picked slate of nominees for election to the board at the annual meeting set for Aug. 23.

The company sent a letter to its shareholders outlining its objections to Harbinger's actions, according to a company news release.

"Harbinger is asking Ryerson's stockholders to hand over control of their company without saying whether or not Harbinger's nominees will complete the sale to Platinum, without compensating stockholders, without a strategy, operating plan or management team, and importantly in today's credit environment, without securing committed financing for approximately $900 million of debt that would become due upon a change in control of the board," chairman and chief executive officer Neil Novich stated in the letter.

Novich also took issue with Harbinger's description of Ryerson's strategic review process as flawed. He said the board conducted an "exhaustive process" that included contacting more than 50 parties and negotiating a go-shop provision "which has kept the door open for other bidders."

"We urge our stockholders to support our current capable, independent board of directors to be assured of keeping their opportunity to vote on the Platinum transaction for $34.50 per share," Novich added.

Ryerson shareholders are expected to vote at the Aug. 23 meeting on the company's proposed acquisition by Platinum Equity, LLC in a $2 billion transaction that will take the company private.

Under the companies' definitive agreement, an affiliate of the Beverly Hills, Calif.-based private equity firm will acquire all of the outstanding shares of Ryerson common and convertible preferred stock for $34.50 per share in cash. Ryerson's board unanimously approved the deal.

As previously reported, Harbinger, Ryerson's largest stockholder, believes the Chicago-based metal processor's current board, as well as its senior management, have "consistently underperformed."

Harbinger Capital is a New York investment firm.

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