GNL’s Board has Refused to Commit to Important Governance Enhancements Unless Shareholders Approve the Proposed Merger
NEW YORK, July 20, 2023 — Orange Capital Ventures, LP (“Orange Capital”), a New York-based investment firm, today issued the following statement outlining its serious concerns about what it believes are blatantly coercive tactics employed by the Global Net Lease, Inc. (NYSE: GNL) (“GNL” or the “Company”) Board of Directors (the “Board”) regarding the proposed merger (the “Merger”) with Necessity Retail REIT (Nasdaq: RTL) (“RTL”).
We are alarmed that to date the Board has failed to commit to enacting its own proposed governance enhancements absent shareholders approving what we believe will be a highly contested vote on the proposed merger with RTL. It is our judgement that the Board is deploying coercive tactics in an attempt to force long-suffering GNL shareholders to approve the Merger to gain access to much-needed and long-overdue governance reform.
Even GNL’s Chair of the Board has been publicly enthusiastic about the proposed governance changes, stating “GNL Post-closing’s enhanced corporate governance is highlighted by a majority-independent, declassified Board, as well as other enhancements that we are proud to institute.”
To our knowledge, if and only if GNL shareholders approve the Merger, upon closing the Board has committed to enact certain governance improvements, including: declassify the Board so that seven of the nine directors would stand for election to annual terms at the 2024 annual meeting of stockholders, opt out of the Maryland Unsolicited Takeover Act, repeal the Company’s Stockholder’s Rights Plan (Poison Pill), and amend the bylaws to delete the requirement that up to two Board members be “managing directors.”
Orange Capital strongly believes there are far better value creating alternatives for shareholders than the Merger, and that GNL shareholders should be afforded the opportunity to vote on the Merger based solely on the strategic merits of the combination with RTL.
Orange Capital believes the Board should have made these governance changes long before the announcement of the Merger instead of using the promise of better corporate governance practices as leverage in what we believe will be a highly contested vote. Given these coercive actions, along with the enrichment of Blackwells Capital in its settlement agreement in June, we believe the Board anticipates significant shareholder challenges to the Merger as well.
Once again, we call on the Board to publicly commit to making these governance changes – regardless of the outcome of the Merger vote.
Orange Capital delivered a formal inquiry to the Board on July 14, 2023 seeking clarity on its commitment to governance reform regardless of the outcome of the Merger vote, to which the Board has failed to respond. The full text of the letter can be found here.
Orange Capital is being advised by LDG Advisory, LLC and represented by Norton Rose Fulbright LLP.
About Orange Capital
Orange Capital Ventures GP, LP is a New York based investment manager in private and public equity and debt. Orange Capital LLC was founded in 2004. Mr. Daniel Lewis is the founder and Managing Partner.
Contacts:
Daniel Lewis
[email protected]
Media Contacts
ASC Advisors
Steve Bruce / Taylor Ingraham
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203 992 1230
SOURCE Orange Capital Ventures, LP
