Starboard Delivers Special Meeting Request To Depomed

(RTTNews) - Starboard Value LP , one of the largest shareholders of Depomed, Inc. (DEPO), with beneficial ownership of approximately 9.8% of Depomed's outstanding shares, announced it has delivered an open letter to Depomed shareholders. Starboard also announced that as of this past Friday it has delivered to Depomed more than the required consents to call a Special Meeting of Depomed shareholders and has set November 15, 2016 as the date for the Special Meeting.

Starboard stated that it intends to vigorously pursue replacement of the entire Board to ensure that Depomed is being run in a manner consistent with the best interests of all shareholders. It believes the Board clearly lacks the independence, objectivity, and perspective needed to make decisions that are in the best interests of all shareholders.

"In addition, in order to maintain a degree of continuity on the new Board, in the event that the current Board is removed and our nominees are elected at the Special Meeting, the new Board would be willing to increase the size of the Board to eleven members and add back up to three incumbent directors," said Starboard.

Starboard believes that Depomed is deeply undervalued and significant opportunities exist within the control of management and the Board of Directors to unlock substantial value for the benefit of all shareholders. . Starboard continues to believe it is necessary to make substantial changes to the composition of the Board as soon as possible so that steps can be taken to create value for the benefit of all shareholders.

Starboard said, "Based on recent press reports, it appears that Depomed may have hired bankers to explore a sale. As we have outlined publicly, we believe Depomed would be extremely attractive to numerous potential acquirers, and while there exists an opportunity to significantly improve operations at the Company, an outright sale may be the best option for unlocking shareholder value. However, we remain extremely concerned that any potential sale process may not be undertaken with genuine intent, but rather as a smokescreen to distract from the required Board changes we are seeking and protect the current Board's positions beyond the Special Meeting."

Starboard said it also does not trust the current Board to steward any sale process given the lengths the Board went to rebuff the approach by Horizon in 2015.

Starboard noted that it has little confidence that it will begin a thorough and genuine process that includes all potential suitors in a manner designed to successfully maximize value for all shareholders. Therefore, it believes that it is necessary for directors proposed by Starboard to be involved in any sale process at the Board level to ensure that the Board is actually and capably representing the best interests of shareholders and that value is maximized.

Starboard has been advised that Depomed has notified Broadridge Financial Solutions of a September 27, 2016 record date for the Special Meeting. It is crucial that shareholders take whatever steps may be needed with their custodial banks and brokerage firms to ensure that they have the ability to vote their shares at the Special Meeting.

Starboard said, "It is important for shareholders to understand that while we firmly believe a change of the majority of the Board is warranted, we do not practically have any other option for seeking Board composition changes at the Special Meeting but to seek the removal of the entire Board."