JANA Partners reached agreement with Mercury Systems

Market Cap: $1.9 billion| Mercury Systems, Inc., a technology company, engages in the manufacture and sale of components, products, modules, and subsystems for aerospace and defense industries in the United States, Europe, and the Asia Pacific.. 

Background

JANA Partners

·         On December 23, 2021, JANA Partners (6.6%) intends to have discussions with the board and management regarding maximizing value for shareholders including evaluating strategic alternatives including a sale of the company, operations, capital allocation, corporate governance, board composition, and compensation practices. Source

·         On January 31, 2023, the Company announced that its Board of Directors has approved a plan to explore strategic alternatives, including a potential sale of the Company. Source

·         On February 3, 2023, JANA Partners (4.6%) appreciates the constructive dialogue it has had with the Board and management and applauds the Board’s decision to enhance shareholder value by engaging financial advisors and exploring a sale. Source

Starboard

·         On January 13, 2022, Starboard (7.3%) delivered an open letter to the board stating its belief that the Rights plan adopted by the company on December 27, 2021 is not in the best interests of the shareholders. It asked that the Board immediately eliminate the Rights plan. Alternatively, if the Company is unwilling to fully remove the Rights Plan, Starboard stated that it would expect the Company to, at the very least, (1) raise the ownership threshold which triggers the Rights Plan from 7.5% (or 10% in the case of a passive investor) to 15% for all shareholders and (2) thereafter put the Rights Plan to a vote of all shareholders.

·         On June 23, 2022, Starboard Value and JANA Partners entered into an agreement with the company and pursuant to it, the company agreed to immediately increase the size of the Board from nine (9) to eleven (11) directors and expand the size of Class I directors by two (2) directors and appoint Howard L. Lance (the “Starboard Appointee”) and Bill L. Ballhaus (the “JANA Appointee” and together with the Starboard Appointee, the “New Independent Appointees”) to the Board as Class I directors.

Update

On July 6, 2023, JANA Partners (8%) entered into a voting agreement with the company, pursuant to which Scott Ostfeld, a Managing Partner of JANA, was appointed to the board of directors. Source