Firefly stated Thursday morning it sent the letter because of frustrations it has with Gulfport’s board and leadership team in failing to maximize shareholder value.
Gulfport didn’t respond Thursday morning to an emailed request for a comment.
“To date, we have been patient with decisions made by the board and management, and we appreciate the time that Gulfport’s chairman and new CEO recently spent with us to discuss our views on the company,” Firefly wrote.
“However, as we previously communicated to you, we have been discouraged by the board’s lack of urgency in addressing the company’s prolonged stock price underperformance and its unwillingness to commit to actions that we believe would maximize value for stockholders.”
In the letter, it describes itself an experienced investor in the natural gas exploration and production industry in Appalachia that also has held a significant amount of Gulfport stock since 2013.
The letter states it believes Gulfport, which drills and produces wells in
However, the investor’s letter states share values for Gulfport’s stock consistently have underperformed, compared to peer companies and broader indicies. Firefly also is critical in its letter about past equity issues the company has used to raise about $2.9 billion in funding.
Firefly’s letter acknowledges that Gulfport’s board authorized a $200 million share repurchase plan in early 2018, but notes that plan was stopped midway through the year and that the company’s stock has fallen in value by 20 percent since.
Firefly also requests that Gulfport sell noncore assets it holds in southern
“With significant cash on hand, positive free cash flow, and noncore assets to sell, Gulfport has been missing a meaningful opportunity to repurchase additional shares at a discount,” Firefly wrote.
“Thus far, our efforts to engage privately with the board have left us questioning whether the board’s composition must change before Gulfport will take actions necessary to maximize stockholder value. We believe that adding meaningful stockholder representation would greatly enhance the board’s perspective.”
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