On November 9, 2016, GAMCO Asset Management Inc. (“GAMCO”) and certain affiliates, delivered a letter to the Issuer (the “Nomination Letter”) nominating Mr. Lance A. Bakrow (the “Nominee”) for election to the Issuer’s Board of Directors (the “Board”) at the Issuer’s 2017 Annual Meeting of Stockholders (the “2017 Annual Meeting”). As far as I know, this is the first use of a proxy access bylaw.
GAMCO’s nomination is pursuant to Article IA of the Issuer’s Bylaws, which is a recently-adopted proxy access provision which is intended to provide stockholders with greater access to put forward nominations of individuals for director on the Issuer’s proxy card. GAMCO believes its Nominee’s skill sets and highly relevant business and financial experience, as evidenced by his bio included in the 13D/A filing, will be extremely valuable to the Issuer and GAMCO is confident that its Nominee will have an immediate positive impact on the Board.
Lance A. Bakrow, Age 59, is the co-founder and a director of Greenwich Energy Solutions, a private company that provides independent energy solutions in the northeastern United States (“GES”). Mr. Bakrow founded and has worked at GES since July 2009. Mr. Bakrow is also co-founder and director at SourceGreen, LLC (“SourceGreen”), a private company that is a leading developer, owner and operator of industrial scale renewable energy solar infrastructure projects, which he co-founded in October 2010. In 1994, Mr. Bakrow founded Greenwich Energy Partners, a private global energy trading and asset investment firm which, after extremely rapid growth, was sold in 1997 to Duke Energy Corporation (NYSE: DUK) (f/k/a Cinergy Corp.), an electric power holding company, where he continued to work until 2008. Mr. Bakrow, in 2000, formed Greenwich Power, a private equity company focused on energy investments in new technology, alternative energy, and energy risk management solutions and he worked there as co-founder and director until 2006. Prior to this, from 1985 to 1994, Mr. Bakrow worked as a Partner at The Goldman Sachs Group, Inc. (NYSE: GS) (“Goldman Sachs”), a global investment banking firm, where he ran energy and other related commodity trading and marketing, for the firm. Prior to his time at Goldman Sachs, Mr. Bakrow worked as a trader at Cargill, Inc., a privately held global agribusiness company, from 1981 to 1985. Mr. Bakrow earned a Bachelor of Arts Degree in Business from the University of Arizona in 1979.
GAMCO First to Invoke Proxy Access: Update 11/11/2016
First! Proxy access has swept across US corporates faster than any governance idea in decades. But no one actually has used investors’ newfound right to nominate directors on the corporate proxy—until now. On Wednesday Mario Gabelli’s GAMCO Investors hedge fund nominated Lance Bakrow, co-founder of privately held Greenwich Energy Solutions, to the board of National Fuel Gas, which adopted an access bylaw in March. GAMCO owns 7.8% of National Fuel and has been pushing for a spinoff of some units. Expect business groups to cite the nomination as confirmation of arguments that access opens doors to shareowners with private agendas.
Gamco is not a typical activist, however. It holds many of its investments in mutual and closed-end, not hedge funds. Its average holding period for current activist investments is over nine years, according to Activist Insight Online (it has been involved at National Fuel Gas since 2010). And it has a habit of doing things differently, sponsoring a precatory (non-binding) proposal promoting a spinoff at National Fuel Gas a few years ago, and often soliciting proxies in-house for proxy contests proper (saving proxy solicitor fees that often run in the hundreds of thousands of dollars, and millions for the biggest fights).
An even more extensive analysis within the context of current proposals at GAMCO’s First Use of Proxy Access and “Fix-It” Proposals.