Two top executives of Coinstar Inc. are urging shareholders to support the coin-counting machine company's incumbent board nominees and to reject a slate proposed by a hedge fund that has been buying up its shares and agitating for a strategic shift to boost its stock price.
"Your board of directors and management team are successfully executing Coinstar's goals — as demonstrated by the approximate 200% increase in Coinstar's stock price since mid-2003," David W. Cole, Coinstar's chief executive, and Keith D. Grinstein, the Bellevue, Wash., company's chairman, wrote in a letter to shareholders Wednesday.
Coinstar's nominees are Deborah Bevier, David Eskenazy, and Robert Sznewajs, all of whom have been on the board since early in this decade.
They are opposed by Eugene I. Krieger, John M. Panettiere, and Arik Ahitov, two employees of and an adviser to Shamrock Activist Value Fund, which has said that it owns a 13.39% stake in Coinstar.
Shamrock, a Burbank, Calif., hedge fund, said in an April filing with the Securities and Exchange Commission that it "believes that a change in composition of the board is necessary to maximize value for the benefit of all company stockholders," and it criticized the return on investment that Coinstar has generated in some of its business lines.
The Coinstar executives were critical of the hedge fund's performance in their letter, writing that it has "overseen declining financial results and stockholder returns at most companies where Shamrock has gained board representation."
