The largest shareholder of Calgary-based SYNSORB Biotech Inc. has succeeded in installing its own board of directors for the embattled company.
Scout Capital Corp. said it obtained sufficient votes through its proxy solicitation to elect its nominees prior to SYNSORB’s annual meeting held May 7.
The new SYNSORB board of directors consists of Scout president and CEO David Tonken, Jim Silye and Tim Tycholis, who were Scout’s nominees, and Gerry Quinn and Bruce Kenway, who were nominees of SYNSORB management.
Scout Capital requested that Quinn and Kenway continue as directors of SYNSORB. Scout said this combination will allow the new board to draw upon Scout’s experience in revitalizing companies while maintaining some continuity in the board.
The new board appointed Tonken as chairman and Silye as president and CEO. Bill Hogg, who took over the CEO position after David Cox stepped down in March, will now return to the CFO position.
Scout Capital (SKT-TSX Venture) acquires control of under-performing public companies, reorganizes them and resells the business to new management teams as a clean public “shell.”
Scout mailed shareholders its proposal last month, claiming SYNSORB has been run without an effective strategy to enhance the value of its shares. It also objected that SYNSORB directors and management had “nominated only themselves” for board posts.
The letter, signed by Tonken, said a new management team with expertise in revitalizing public companies was essential for SYNSORB’s success.
SYNSORB (SYB-TSX, SYBB-NASDAQ) laid off staff and terminated trials last year on its anti-diarrhea drug.
The company had kept its management team to search for strategic alternatives. Meanwhile, SYNSORB shareholders approved a plan to consolidate company shares on the basis of one new share for eight old shares, and for SYNSORB to distribute four million previously issued common shares of Oncolytics Biotech Inc. that it owns to SYNSORB shareholders.
