Specialty re/insurer Argo Group has issued a statement defending the validity of its two most recent Board appointments after Voce Capital Management, a company that owns 5.6% of Argo’s shares, claimed the hires went against company bye-laws and Bermuda law.
Argo labelled Voce’s claims “disappointing” and part of a “campaign of misinformation to support its activist campaign to remove members of Argo’s well-qualified and experienced Board.”
Voce first sparked this war of words when in February it accused Argo Chief Executive Officer Mark E. Watson III of perpetuating “shockingly high and shockingly inappropriate” corporate expenses over the past decade.
In a statement released the following morning the Board accused Voce of ignoring the firm’s track record of “strong value creation for all shareholders.”
Voce’s latest criticism follows recommendations issued to Argo shareholders by the Board urging they not endorse or vote in favour of any Voce Proposal or Voce Nominee, after the investor had put forward five independent candidates in what it described as an attempt to “right the ship.”
“A review of the Proxy Statement reveals that the Board has chosen to push forward with a slate of Directors that has been fatally compromised by its two putative Director appointments announced on February 21, 2019, each of which Voce believes are invalid under the Company’s Bye-laws and Bermuda law,” Voce statement reads.
“Argo’s Bye-laws, Section 22(6), authorize the Board to appoint Directors only ‘to fill a casual vacancy,’ which under well-settled precedent has long been interpreted to mean only death or resignation in between annual meetings; otherwise, only shareholders may fill vacant Board seats.”
In response, Argo says Voce’s assertions challenging these appointments are “simply incorrect.”
“Latham and Liss to fill two vacancies, bringing the number of directors up to 13 as authorized by Argo Group’s bye-laws and Bermuda law.”
“It is telling that Voce waited five weeks to raise its latest attempt to distract Argo’s shareholders,” Argo added.
“Our Board remains focused on continuing Argo’s strong performance and looks forward to continuing to engage with all shareholders in the coming weeks.”
