CCI - Elliott Sends Letter to the Board of Crown Castle Inc. Summarizing Feedback Supportive of Change | Benzinga
Responses From Investment Community, Current and Former Employees and Industry Experts Overwhelmingly Support the Need for Change
Highlights Widespread Lack of Confidence in Company's Strategy, Current Management and Board
Reiterates Need for a Robust Review of Fiber Business, CEO Change and a Reconstitution of the Company's Board
Full Letter Available at RestoringTheCastle.com
WEST PALM BEACH, Fla., Dec. 7, 2023 /PRNewswire/ -- Elliott Investment Management L.P. ("Elliott"), which manages funds that collectively have an investment of approximately $2 billion in Crown Castle Inc. ("Crown Castle" or the "Company"), today sent a letter to Crown Castle's Board (the "Board") summarizing the feedback received since publicly sharing its views on the Company last week. The feedback, which was overwhelmingly supportive of change at Crown Castle, came from investors, analysts, current and former employees, and industry experts, among others.
As Elliott wrote in the letter, "the commentary has been consistent and highly critical of the Company and its strategy and leadership, including the apparent lack of oversight by the Board."
Elliott went on to note that in the week following the release of its materials, Crown Castle's stock price appreciated by 14.5% and the Company outperformed its direct peers by 8.4% – the largest week of outperformance for Crown Castle in the last decade. "In effect," the letter noted, "Jay Brown's severe underperformance as a CEO has made the prospect of his departure his greatest moment of outperformance."
In the letter, Elliott also took aim at the Board's continued lack of oversight and wrote, "The Board's refusal to act in the face of such overwhelming data and robust support for change would be a failure of its most basic duty of oversight and stewardship on behalf of shareholders."
Elliott added that while it "remain[s] hopeful that we can align with the Board on a constructive path forward, it is even clearer to us today based on the feedback we have received that Crown Castle requires CEO change and a robust review of the Fiber business."
Elliott concluded the letter by stating that if the Crown Castle Board is unwilling to make necessary leadership changes, Elliott will nominate a new Board that will. Based on the shareholder feedback it has received, Elliott, the letter said, is "confident that shareholders will choose a Board with a greater commitment to shareholder stewardship and best-in-class governance."
The letter can be accessed at RestoringTheCastle.com.
The full text of the letter follows:
December 7, 2023
Board of Directors
Crown Castle Inc.
8020 Katy Freeway
Houston, TX 77024
Dear Members of the Board:
We are writing to you again on behalf of Elliott Associates, L.P. and Elliott International, L.P. (together, "Elliott" or "we"). Since publicly sharing our views last week on Crown Castle Inc. (the "Company" or "Crown Castle"), we have had the opportunity to hear from numerous investors, analysts and industry leaders on the merits of our perspectives and recommendations. The feedback has been overwhelmingly supportive of significant change at Crown Castle, including unsolicited feedback from many current and former employees and executives of the Company. CEO Jay Brown's Fiber strategy has been universally panned by investors, industry insiders (including competitors, peers and advisors) and even the Company's own employees to such an extent that the Board's failure of oversight deserves intense scrutiny. In today's letter, we summarize this feedback and question what level of underperformance this Board will tolerate before taking action.
To begin, we think it is important to highlight the extraordinary support for the mere prospect of CEO and strategy change manifested in Crown Castle's stock price. In the week following the release of our materials, Crown Castle's stock appreciated by 14.5%1. More importantly, Crown Castle outperformed its direct peers – American Tower and SBA Communications – by 8.4%2, which stands as the largest week of outperformance for Crown Castle in the last decade.
See "Crown Castle's Top 10 Weeks of Outperformance Over Last Decade2" image.
The magnitude of Crown Castle's outperformance was so great, it exceeded that of any one-week relative move over the entirety of Jay Brown's tenure as CEO, underscoring that the degree of sentiment shift was truly unique. In effect, Jay Brown's severe underperformance as a CEO has made the prospect of his departure his greatest ...