Print Solutions Magazine

Burton Capital Management LLC, Greenwich, Conn., said that it’s “very disappointed” with Cenveo™ Inc.’s choice of its CEO James R. Malone. Malone was appointed CEO June 27.

In a June 24 letter to Cenveo Chairman Susan Rheney, Robert G. Burton, chairman, CEO and managing member of Burton Capital Management, said: “As Cenveo’s largest shareholder, we are very disappointed with your choice of Cenveo’s new Chief Executive Officer, particularly given that he does not have any printing industry experience. We believe Cenveo needs a senior manager with direct industry experience and a successful track record in printing, not an individual who will take time (time we believe Cenveo does not have) to get up to speed on the industry. Cenveo shareholders are now left with a company that has both a Chairman and a Chief Executive Officer with no hands-on printing industry experience, a situation we find unacceptable. We find this very troubling given Cenveo’s recent financial performance and believe that you have once again failed Cenveo’s shareholders. Accordingly, this leaves us no choice but to continue to seek to remove and replace the current board of directors at the special meeting of shareholders to be held in September. We continue to believe this is in the best interests of Cenveo’s shareholders.”

Earlier, Englewood, Colo.-based Cenveo confirmed that it received a letter from Burton Capital Management, Goodwood Inc., and other shareholders calling for a special meeting of Cenveo’s shareholders. Cenveo said that if a meeting of shareholders has been properly called, the board will meet and set a date for it.

In May, Cenveo rejected a proposal from Burton Capital Management that would have resulted in the appointment of Burton as the firm’s chairman and CEO, according to a letter Burton wrote May 25 to Rheney.

According to the letter, Burton met May 6 with Rheney, Cenveo board member Jerry Pickholz, and legal and financial advisors, to give an hour-long presentation about his company’s plan to increase Cenveo’s shareholder value. “We were very disappointed in being turned down again by your board,” Burton said in the letter. He said no Cenveo board member asked a question during the presentation and that his company believes Cenveo “met with us solely in an attempt to preclude a future claim that you refused to meet with us. We now feel that our meeting was a sham.” He continued: “Your illusory offer for us to ‘participate’ in a process that is undefined as to its timing and potential outcome, and to require us to sign a confidentiality agreement that we believe would prevent us from fully communicating with Cenveo’s shareholders, is completely unacceptable.”

Burton Capital Management and individual members of its group are Cenveo’s largest shareholders, owning 5,396,234 shares of its common stock. In April, BCM increased its ownership in Cenveo from 9.6 percent to approximately 10.8 percent of outstanding common stock. That move came after Cenveo responded to a letter from Burton, in which he outlined the history of BCM’s attempt to acquire and run Cenveo.

Cenveo repeatedly has said it’s seeking “strategic alternatives” to improve shareholder value, including selling the company. According to Burton’s May 25 letter, an investor group that Cenveo had solicited called Burton to gauge his interest in managing Cenveo if the investor group bought it. “We expect to receive other such calls as you solicit interest from financial buyers and others with no printing industry experience,” Burton said in the letter. He added: “We feel the only way to resolve these shareholder issues is the American way—with a vote. In the very near future you will receive a request from our group for a special meeting of shareholders to remove the existing directors and nominate a slate of directors who will affirmatively act in the best interests of Cenveo’s shareholders.”

Prior to BCM’s inception in January 2004, Burton was chairman, president and CEO of Moore Corporation Ltd. from 2000-2002, during which he cut operating costs by $150 million and increased Moore’s stock price from a low of $2.50 to a high of $14.45 per share. Previously, he was chairman, president and CEO of World Color Press Inc., where he led its merger with Quebecor Printing Inc.

Boise Cascade Co., Boise, said it canceled its planned initial public offering of stock after cutting its expected price range, citing adverse market conditions. The company and its equity sponsor, Madison Dearborn Partners, had hoped to sell 16 million shares to the public and begin trading on the New York Stock Exchange in May.

Champion Industries Inc., Huntington, W. Va., reported a loss of $97,000 in the second quarter, compared with net income of $161,000 a year earlier. The company said its results were due to charges and associated expenses for various legal issues, including the settlement of a Mississippi lawsuit and accruals totaling $777,000. Revenue increased 10 percent to $33.6 million.

R.R. Donnelley & Sons Company, Chicago, completed the previously announced move of its corporate headquarters to an office tower at 111 S. Wacker Dr. in Chicago. The headquarters also will house the Chicago offices of the company’s Global Capital Markets business, which manages financial transaction documents for mergers and acquisitions, privatization deals, global offerings and regulatory filings. The facility features soundproof conference rooms, a recreational lounge, dining room, relaxation rooms with day beds and showers, and 24-hour onsite catering and concierge services.