Punch and Associates sends letter to Board of Directors of Avid Bioservices, Inc.

Intends to vote AGAINST proposed acquisition of company by GHO Capital and Ampersand Capital.

Punch and Associates Investment Management, Inc. sent a letter today to the Board of Directors of Avid Bioservices, Inc., sharing its views on the proposed acquisition by GHO Capital and Ampersand Capital and announcing its intention to vote AGAINST the proposal.

The text of the letter follows:

November 14, 2024

Dear Directors,

Punch & Associates is the beneficial owner of approximately 2.9 million shares of Avid Bioservices, representing 4.5% of the shares outstanding. We have been continuous shareholders since September of 2020.

We strongly believe that the recently announced offer by GHO Capital and Ampersand Capital to acquire the company for $12.50 per share materially undervalues Avid and is opportunistically timed to take advantage of trough valuations and a likely inflection in the fundamentals of the business. The current offer gives no value to idle production capacity, medium-term earnings power, or net operating losses. If GHO Capital and Ampersand Capital are unwilling to raise their bid significantly to reflect the asset and earnings value of the company, we are happy to continue as public shareholders.

Long-term, supportive shareholders like ourselves have patiently waited through a significant capacity expansion, an extended industry downturn, and balance sheet mismanagement over the past several years. Now those headwinds are finally abating, and financial performance is on an upward trajectory, but the Board is recommending a sale of the company at a negligible premium to the current market price. This defies logic.

We intend to vote against this proposal.

Regards,

Howard D. Punch, Chief Investment Officer

Punch & Associates Investment Management, Inc.

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