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ANCHORAGE - The battle is heating up for control of Alaska's most profitable Native corporation, Anchorage-based Cook Inlet Region Inc.
Shareholders are poised to elect five new directors at the company's June 7 annual meeting in Soldotna. People on either side of CIRI's internal feud are waging intense campaigns to win votes, according to the Anchorage Daily News.
Shareholders also will tell the company, in an advisory vote, whether to hand out a $62 million special dividend - opposed by management - that would amount to about $10,000 per shareholder.
The pro-management majority on CIRI's 15-member board of directors has been running newspaper ads and radio spots, along with direct mailings to shareholders. The majority is urging shareholders to vote against the special dividend and to elect board-endorsed candidates, rejecting claims by a strong, vocal band of critics who say the regional company is in deep trouble and needs reform.
The Alliance for the Future of CIRI, led by the company's former chief executive Roy Huhndorf and former vice president Robert Rude, is also mounting a campaign, through newsletters, telephone calls and word of mouth.
The group says CIRI masks millions of dollars in losses through the one-time sale of assets, dividends are declining, management spends lavishly and the company is shrouded in secrecy. The group says the existing regime maintains itself through an unfair election process in which the company underwrites board-endorsed candidates while independents must fund their campaigns out of pocket.
The Alliance hopes to seat three of its candidates in the upcoming election, which would bring the number of dissidents on the board to five. Although that would still be a minority on the board, the group says it's a multiyear effort and that eventually it will gain control.
In a recent mailing to shareholders, the board majority lambasted the Alliance for conducting "witch hunts" and spreading "falsehoods, half-truths, and slander to tear your company down." It labeled the group a "takeover team" that is jockeying to gain control of a stable, successful company.
"I think shareholders are sick of it," chairman Terry Simpson said. "They want the board to conduct business, not politics."
The Alliance is pushing for the special dividend just to gain the support of shareholders, knowing that the board majority will reject it, he said. CIRI needs the money to reinvest in new businesses, Simpson added. But the Alliance says shareholders would be better off with the cash because the management lacks vision and the company is adrift.
While envied by other Native corporations for its savvy in business ventures such as telecommunications and real estate, the company has a relentless group of detractors who say its managers are greedy and reckless and should share more of the company's wealth with shareholders.