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Press release from Business Wire

Octavian Responds to EnerCare's False Statements and Blatant Scare Tactics

<p class='bwalignc'> <b>Asks Ontario Securities Commission To Investigate EnerCare's Untrue Statements And Potential Breaches Of Securities Act</b> </p>

Tuesday, April 17, 2012

Octavian Responds to EnerCare's False Statements and Blatant Scare Tactics17:27 EDT Tuesday, April 17, 2012 NEW YORK (Business Wire) -- Octavian Advisors, LP, the largest shareholder of EnerCare Inc. (TSX: ECI), which owns approximately 13% of EnerCare's outstanding common shares and has been a shareholder for more than two years, responded to a new round of false statements made by EnerCare in its press release today that are clearly designed to scare shareholders in order to preserve the status quo and entrench the current Board of Directors. Octavian has sent a letter to the Ontario Securities Commission requesting a full investigation into EnerCare's false statements, which Octavian believes are in breach of the Securities Act. “With these latest baseless accusations and blatant scare tactics, EnerCare's Board has reached a new low in its ongoing attempt to manipulate shareholders,” said Richard Hurowitz, Chairman and Chief Executive Officer of Octavian. “The Board's increasingly desperate behavior demonstrates they are willing to go to whatever lengths necessary to disenfranchise shareholders to protect their own positions. We have asked the Ontario Securities Commission to conduct an investigation to ensure EnerCare shareholders are able to make a fully informed decision at the April 30 shareholder vote and so that the Board is held accountable for its improper conduct.” Octavian responded to the following attempts by EnerCare's Board to distort the record:       ENERCARE LIES   THE TRUTH“Octavian has proposed to load EnerCare with debt in order to finance a one-time special dividend, which would immediately enrich Octavian, but undermine EnerCare's prudently managed financial health. The Octavian dividend would result in an approximate 25% increase in EnerCare's Net Debt to EBITDA ratio and endanger EnerCare's strong corporate credit ratings.”-- April 17, 2012 press release   Octavian believes EnerCare has tremendous value the current Board is failing to realize. We believe there are several initiatives that have the potential to create material value for shareholders, and that EnerCare should objectively examine these options.   One option is to pay a special dividend, which would be in addition to – not instead of – the regular monthly dividend. An increase in leverage by less than one turn could potentially permit the company to pay out to shareholders a special dividend of $2.50 per share while maintaining the regular monthly dividend.   A special dividend would be payable to ALL EnerCare shareholders– not just Octavian, as EnerCare has insinuated – and should be considered as one of many options, including a spin-off of the submetering business, a share buyback, and a sale of the company, as part of a comprehensive and objective process to evaluate all value-creation opportunities. “EnerCare shareholders would lose their regular monthly dividend if Octavian seizes control of the Board.” -- April 17, 2012 press release   EnerCare is resorting to outrageous accusations to scare shareholders into believing Octavian would want, or be able, to disrupt regular monthly dividends.   This is most ironic considering it was Octavian that urged EnerCare to increase the dividend a year ago, long before the Board authorized the recent increases. The same Board that previously cut your dividend is now trying to take credit for the recent increase Octavian had previously recommended -- and mislead you into thinking Octavian would abolish it.   It is important to remember that Octavian is seeking minority representation on the Board – not control. If elected, Octavian's nominees – three of whom are completely independent and one of whom represents the company's largest shareholder – would only occupy four out of 10 seats on EnerCare's Board. Octavian's nominees would work alongside six of EnerCare's current directors to ensure that the best interests of ALL shareholders are appropriately represented. “Since its IPO, EnerCare has outperformed the broader market and provided strong returns to investors.” -- April 17, 2012 press release   EnerCare has now resorted to broad statements with no factual basis after its previous attempts to distract EnerCare shareholders from its underperformance with incomplete and self-serving calculations failed.   The truth is, if you examine the timeframe from EnerCare's IPO in 2002 until April 27, 2011, the last trading day before Octavian announced it might seek changes to EnerCare's Board, EnerCare shares returned only 57% versus a 145% return for the S&P/TSX Composite Index. This calculation includes dividends but does not assume they're reinvested; underperformance is even greater if one assumes dividends are reinvested.   Since Octavian made its concerns public on April 28, 2011, EnerCare shares have returned 46%. Over the same period, the Canadian market has decreased by 12% (also including dividends without reinvestment).* This is another example of Octavian's intention to disrupt EnerCare's sound business plan by seizing control of EnerCare for Octavian's own short-term gain." -- April 17, 2012 press release   The Board has unsuccessfully tried to caricature Octavian as a short-term investor by employing misleading claims that miss the point that shareholders have a right to be heard.   Octavian owns approximately 13% of EnerCare and has been a shareholder for over two years. Octavian's interests are aligned completely with yours and we will work extremely hard to maximize value for the benefit of all shareholders.   EnerCare's current Board, on the other hand, owns less than 0.3% of EnerCare shares, and is only interested in further entrenching itself. “EnerCare's Board was ranked 3rd highest in governance standards, twice by the Globe & Mail.” -- April 2012 investor presentation   EnerCare neglects to mention it received its 3rd place ranking from the Globe & Mail in 2006 and 2007. Since then, EnerCare dropped to 9th place (out of 11) in 2008 and did not appear on thelist at all in 2009, 2010, and 2011.   EnerCare's Board is insulting your intelligence with out-of-date statistics in order to cover up its glaring corporate governance issues. Octavian urges its fellow shareholders to vote their YELLOW form of proxy to elect our highly qualified nominees – Beth Horowitz, Graham Senst, T. Richard Turner, and Richard Hurowitz – to EnerCare's Board of Directors at the annual and special meeting of shareholders scheduled to be held on April 30, 2012. Octavian's nominees – three of whom are completely independent and one of whom represents the company's largest shareholder – will represent a minority of the Board and will work for EnerCare shareholders to maximize the value of their investment. For more information on how to vote your YELLOW form of proxy, as well as access to other important materials, please visit www.ShareholdersForEnerCare.com. If you have any questions and/or need assistance in voting your shares, please call MacKenzie Partners, Inc. at 1-800-322-2885 (toll-free) or 212-929-5500 or e-mail enercare@mackenziepartners.com and they will assist you. Collect calls will be accepted. * Based on EnerCare's closing share price on April 10, 2012.About Octavian Advisors, LP Octavian Advisors, LP is a global investment firm with offices in New York and London. The firm focuses on special situations and distressed investments in international markets, and has successfully invested in over 40 countries on six continents. Octavian currently manages approximately $1 billion for leading endowments, foundations, pension funds, family offices and institutions. Cautionary Statement Regarding Forward-Looking Information Certain information in this press release may constitute “forward-looking information”, as such term is defined in applicable Canadian securities legislation, about the objectives of Octavian as they relate to EnerCare, the potential impact of certain initiatives on the value of EnerCare shares, the impact of the Octavian Nominees, if elected, on the financial condition, results of operations, business strategies, revenue enhancements, competitive position of EnerCare, the risks related to shareholders' investment in EnerCare if the current board continues to control the direction of EnerCare, and other matters. All statements other than statements of historical fact may be forward-looking information. Forward-looking information is often, but not always, identified by words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “would”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions. Material factors or assumptions that were applied in providing forward-looking information, include, but are not limited to, EnerCare's future growth potential, its results of operations, future cash flows, the future performance and business prospects and opportunities of EnerCare, the election of the Octavian Nominees, the ability of the Octavian Nominees, if elected, to effect positive change at EnerCare, that the six of the current directors recommended by Octavian for election to EnerCare's Board at the annual and special meeting of shareholders scheduled to be held on April 30, 2012 (the “Management Nominees”) will consent to serve on EnerCare's Board with the Octavian Nominees and the current general regulatory environment and economic conditions remaining unchanged. Forward-looking information contained in this press release reflect current expectations of Octavian regarding future events and operating performance of EnerCare, and speak only as of the date of this press release. Such forward-looking information is based on currently available competitive, financial and economic data and operating plans and are subject to known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of EnerCare, or general industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Recent events in global financial and credit markets have resulted in abnormally high market volatility and a level of uncertainty not seen in decades. Such uncertainty may continue to impact the global, North American and Canadian economies in unpredictable ways and may impact the results of EnerCare in a manner which is currently impossible to ascertain. Many other factors could also cause EnerCare's actual results, performance or achievements to vary from those expressed or inferred herein, including without limitation, the possibility that the anticipated benefits from the election of the Octavian Nominees cannot be fully realized or may take longer to realize than expected; that the six Management Nominees will not consent to serve on EnerCare's Board with the Octavian Nominees; the ability of EnerCare to retain and hire key personnel and maintain relationships with customers, suppliers or other business partners following the election of the Octavian Nominees; the impact of legislative, regulatory, competitive and technological changes; the state of the economy; credit and equity markets; availability of credit and other financing; and the financial markets in general. Many of these risks and uncertainties could affect EnerCare's actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking information provided by Octavian. The impact of any one factor on a particular piece of forward-looking information is not determinable with certainty as such factors are interdependent upon other factors, and Octavian's course of action would depend upon its assessment of the future considering all information then available. Should any factor affect EnerCare in an unexpected manner, or should assumptions underlying the forward-looking information prove incorrect, the actual results or events may differ materially from the results or events predicted. All of the forward-looking information reflected in this press release is qualified by these cautionary statements. There can be no assurance that the results or developments anticipated by Octavian will be realized or, even if substantially realized, that they will have the expected consequences. Forward-looking information is provided and forward-looking statements are made as of the date of this press release and except as may be required by applicable law, Octavian disclaims any intention and assumes no obligation to publicly update or revise such forward-looking information or forward-looking statements whether as a result of new information, future events or otherwise. Investors:Mackenzie Partners, Inc.Larry Dennedy, 212-929-5239ldennedy@mackenziepartners.comorMackenzie Partners, Inc.Charlie Koons, 212-929-5708ckoons@mackenziepartners.comorMedia:Sard Verbinnen & CoJonathan Doorley, 212-687-8080jdoorley@sardverb.com