Odyssey Marine Exploration Inc (OMEX)

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Set Backs Lead Ryan Morris On Last Ditch for Aberdeen International Inc. (AAB.TO)

NOTE: (So relevant and worth posting here after all the garbage Ryan has spewed throughout the last many months against Odyssey.I know there is some of this on other boards but not sure if it was this particular article but like most things on Y they find theirselves deleted in short order.)

We live in a fairly logical world, a world where signs lead to probable outcomes. Unfortunately, the signs for Ryan Morris as he continues to pursue his campaign against Aberdeen International Inc. (AAB.TO) are not good.

As we all know, Ryan Morris, President of Meson Capital Partners LLC, along with Nightscape Capital (UK) LLP have attempted to take control of Aberdeen International Inc., a prominent Canadian resource firm. As a result of a private placement transaction that Aberdeen completed last year, Ryan Morris forced Aberdeen into a shareholder proxy vote earlier this month. The vote, which ends on February 3rd, 2015, will determine whether Aberdeen’s current management can remain on the company board or whether they'll be replaced by Ryan Morris and his list of nominees.

Unfortunately for Morris, the past two weeks have not been supportive of his campaign to unseat Aberdeen management.

As was covered in my last article on MiningFeeds, on January 16th, the Institutional Shareholder Services, or ISS, a well-established corporate governance advisory firm, weighed in on the proxy battle between Morris and Aberdeen. Although some would say that ISS’s report was a mixed bag, the report happened to highlight a number of points that continue to be damaging to Morris and his cohorts.

Example: the ISS report mentioned that Ryan Morris’ plan to take control of Aberdeen’s board is “short-term” in nature. More damagingly, the report also stated that,

… the relatively less experienced dissident slate [Ryan Morris and his nominees] which appears to have little mining and board experience of Canadian public companies overall, if elected as a whole, may put the company at a higher risk in terms of business operation and strategic planning.

Throughout January, Aberdeen International has continued to claim, accurately so, that even if Ryan Morris and his nominees do win the proxy vote, Aberdeen’s company by-laws require that a majority of those on the board be Canadian citizens. That puts quite an imposition on Morris and his nominees, since the majority of them, including Ryan Morris himself, are U.S. citizens. How will they ever call a meeting if they win?

Understanding this is a fairly important (and practical) question that should be resolved, Ryan Morris attempted to solve his residency issues in a failed court move on Wednesday, January 21st this week.

On Wednesday, as described in Aberdeen’s most recent press release, the Ontario Superior Court rejected Ryan Morris’ litigation attempts against Aberdeen International. The court rejected Morris on three fronts, these being:
A rejection of Ryan Morris’ attempt to replace the experienced Bernie Wilson, lead director of Aberdeen, as chair of the upcoming proxy meeting;
A rejection of Ryan Morris’ attempts to resolve his and his nominees Canadian residency issues;
A rejection of Ryan Morris’ attempt to impose additional protocols in the upcoming proxy meeting.

To add alcohol to the wound, the Ontario Superior Court also ordered that Ryan Morris and Meson Capital Partners recoup costs associated with their failed application.

Aberdeen’s press release goes on to reiterate more points as to why shareholders should continue to support Aberdeen’s current management. These are points that should remain on shareholder’s minds.

Consider, as example, that change of control fees will be imposed upon Aberdeen International if Morris is voted in. In fact, if Morris and his nominees are voted in, Aberdeen will have to pay $8 million in change of control fees, fees which cannot be cancelled.

In Meson Capital’s most recent press release, published today, Ryan Morris remains dead-set on his promise that he can provide a $0.15 per share return to Aberdeen shareholders if he is voted in. But, these change of control payments remain a serious and inevitable factor, despite arguments coming from Ryan Morris’ camp and despite his litigation attempts. These fees add doubts as to whether Morris is being totally honest in his $0.15 per share promise.

For the past month, Aberdeen International and Meson Capital have been volleying back and forth many of the same arguments as to why shareholders should reject either side. The fact of the matter is that with all the mud slinging, shareholders can lose sense of the truth. More importantly, Aberdeen shareholders can lose sight of who Ryan Morris really is. That's dangerous considering that Ryan Morris is in many ways a stranger and yet he and his nominees want to lead the company.

In order to regain focus on what really matters, perhaps Aberdeen shareholders need to inspect some of the past companies that Morris has lead or been involved with. For a young, thirty-year-old activist investor, Ryan Morris has a quite a track record, and if you look deeper, it’s not in a good way.

Meson Capital’s most recent press release boasts that the company has enjoyed creating shareholder value through their past active involvement in companies like HearUSA, InfuSystem and Sevcon.

Heavy cherry picking can often lead to danger.

Unfortunately, the press release does not mention Morris’ disappointing leadership at Lucas Energy (NYSE: LEI), a company that completely failed to benefit from Morris’ activist takeover. Embarrassingly enough, Morris' time at Lucas Energy also had him booted as a Chairman of the company’s board, as well as Director for the company.

Taking a look at some of Lucas Energy’s message boards, one will notice a suspicious lack of Morris supporters, with one comment on Yahoo running: “He [Ryan Morris] has demonstrated nothing but failure in running his fund and in serving on the BODs of various companies. Was he shrewd in managing LEI from $2.00 to $0.48?"

But, Morris' experience with LEI has not been the only bumpy road in his activist investment endeavors. Reviewing his history, one will also notice another one of his mud slinging activist campaigns, this one against Odyssey Marine Exploration Co. or OMEX. For over a year now, Ryan Morris has been shorting OMEX. And the fact of the matter is that it's a campaign that has left many OMEX shareholders furious, with some angrily accusing Ryan Morris for “outright [lying] to manipulate the share price [of OMEX] downward.”

Ideally, when a company is engaged in a proxy battle, the battle should end with the right party winning. The party, that is, who is most equipped and has the right intentions to represent company shareholders. Momentum just does not seem to be in Ryan Morris' favor – maybe that’s because Ryan Morris' ability to lead Aberdeen International remains undeniably questionable.


- See more at: http://www.miningfeeds.com/2015/01/23/set-backs-lead-ryan-morris-on-last-ditch-effort-to-control-aberdeen-international-inc-aab-to/#sthash.PvHD4ibH.dpuf