You say you want a revolution? This Beatles ditty seems to be a way of
corporate life at musicmaker.com as much as it is a sale item.
The provider of customized music CDs Monday urged its stockholders to
ignore communication “from an insurgent stockholder group comprised of BCG
Strategic Investors, Barrington Companies Equity Partners, dot com
Investment Corporation and their affiliates.”
In a letter signed by Devarajan S. Pathukarai, chairman of
musicmaker.com, stockholders are asked “to not sign consent forms
sent by the insurgents.”
“The Insurgents publicly stated their intention to seek written consents
to take certain actions to take control of the musicmaker.com board of
directors, including amending the bylaws to increase the number of directors
to 15 and to nominate eight individuals, including James Mitarotonda and
Seymour Holtzman to the board of directors,” according to the letter.
“The musicmaker.com board of directors unanimously believes these
proposals are not in the best interest of the public or the stockholders.
The musicmaker.com board of directors has adopted a Plan of Complete
Liquidation and Dissolution which, if approved by the company’s
stockholders, will provide for an orderly liquidation of the company’s
assets,” Pathukarai wrote.
Measures proposed by the existing board of directors include closing the
company’s New York City office, terminating all unnecessary employees while
leaving a minimal staff to wind up business affairs and closing down all
operations and the company’s Web site.
“We are concerned that the Insurgent’s proposals may disrupt the orderly
completion of the liquidation,” Pathukarai wrote. “In contrast, the
Insurgents have failed to identify their proposed plans for liquidation of
the company and failed to disclose all of their contacts, arrangements and
understanding of third parties.”
The company’s share price plummeted to $2-7/8 from a high of $281-1/4 on
the day of its initial public offering in July 1999. Monday morning the
stock was down 3/16, trading at 4 5/16.
Although a liquidation sale is anticipated, the site was not accessible
at press time. A spokesperson for the company was not available for comment.
