Capital Senior Living will appoint a new member to its board under the terms of an agreement with investment firm Lucus Advisors announced March 21 in advance of the organization’s annual meeting.
New York City-based Lucus oversees funds including the Red Alder Master Fund and has repeatedly pressed Dallas-based Capital Senior Living to explore a sale to a third party to “maximize shareholder value.” Lucus owns about 6% of Capital Senior Living through its affiliated funds and managed accounts.
Capital Senior Living’s “cash flow growth, [earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs] margins and occupancy, and other key metrics, are among the best in the industry, and we look forward to continuing to work with the company to enhance value for all of the company’s stockholders,” Schuster B. Tanger, managing member of Lucus Advisors, said in a statement. “We support management’s commitment to operational excellence and are confident that the new independent board member will be a strong addition to the board who will support the company in achieving its substantial potential.”
The agreement calls for Capital Senior Living to consult with Lucus on the board appointment, and Lucus will propose up to two candidates for consideration. Capital Senior Living’s board will present its recommended slate of director nominees in materials that will be filed with the U.S. Securities and Exchange Commission and mailed to all stockholders eligible to vote at its 2016 annual meeting, for which a date has not been announced yet.
“We are confident that a new, independent director will be a valuable addition to our highly qualified and engaged board of directors as we continue to successfully execute our differentiated business strategy and substantially grow in all of our key metrics,” Lawrence A. Cohen, CEO and a director of Capital Senior Living, said in a statement. “We share Lucus’ desire to maximize shareholder value and look forward to working productively with Lucus and our other shareholders to do so.”
