White Electronic shareholder Wynnefield wants company to explore alternatives

By Lisa Kerner

Charlotte, N.C., Feb. 17 - White Electronic Designs Corp. shareholder Wynnefield Capital, Inc. said it is "extremely gratified" that the company appointed Wynnefield nominees Brian Kahn and Melvin Keating to its board of directors.

Wynnefield believes that the addition of Kahn and Keating will help White Electronic dispose of some acquisitions by the company's March 31 target date.

The 6.3% shareholder also urged the company's strategic alternatives committee to "analyze all opportunities available to enhance shareholder value in a very timely manner."

According to Wynnefield, White Electronic holds about $58.5 million in cash and another $9.6 million in assets held for sale as of Jan. 3.

"If it were to realize even half the value of those assets held for sale, then the company's cash balance would exceed $63 million by the end of next quarter, on top of a core business that is generating growth in revenue and backlog," Wynnefield said in a statement released on Tuesday.

White Electronic previously announced it would expand its board to seven directors from five and name Kahn and Keating to the new vacancies under an agreement with a shareholder group led by Wynnefield.

Kahn, founder and investment manager of Caiman Partners LP, was named to the board's strategic alternatives committee and is expected to join the corporate governance and nominating committee.

Keating is the former president and chief executive officer of Alliance Semiconductor Corp.

Either Kahn or Keating will join each of the board's other standing committees, White Electronic said.

Wynnefield agreed to drop its proxy contest and vote all of its shares in favor of all of the board's nominees at the company's 2009 annual meeting.

The agreement also allows each member of the shareholder group, which includes Caiman Partners, to acquire up to 9.9% of White Electronic's outstanding shares. The group currently owns 9.8% of the company's shares.

Phoenix-based White Electronic manufactures microelectronic and display components and systems.

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