Cirrus Networks calls Webcentral claims "misinformed, opportunistic and disingenuous"

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Cirrus Networks calls Webcentral claims "misinformed, opportunistic and disingenuous"

Cirrus Networks has called certain claims made by Webcentral on its financial performance as misinformed, opportunistic and disingenuous, and were purposefully made to intentionally disrupt the company.

In an ASX announcement, Cirrus responded to claims Webcentral made last week on the managed service provider’s performance, alleging that there were “a number of serious deficiencies in the financial and operational management and performance of Cirrus Networks”, including a suggestion that the company’s management team and board were “distant” and “not sufficiently engaged” in day to day operations.

Webcentral is looking to acquire Cirrus Networks for 3.2 cents per share or a total of $26 million, compared to its current share price of 3.4 cents per share. The company acquired shares in Cirrus (8.86 percent) after the latter posted its FY21 trading update on 5 July 2021.

The response comes after Webcentral filed a notice earlier today to have Cirrus hold a general meeting to consider the ouster of three Cirrus board directors and to have them replaced with Webcentral executives.

Webcentral sought to remove Cirrus chief executive Matthew Sullivan, chairman Andrew Milner and non-executive director Daniel Rohr, replacing them with Webcentral CEO Joe Demase and company secretary Michael Wilton. The fourth director, Paul Everingham, was not affected by Webcentral’s proposal.

Cirrus said its board, including Everingham, unanimously agreed that Webcentral’s board overhaul plan was not in the best interest of the company and Cirrus shareholders. The company called on shareholders again to vote against the proposal and the planned takeover as a whole.

The board also said Webcentral’s acquisition of Cirrus shares in July and the subsequent takeover bid were “opportunistic” and in Webcentral’s interest instead of the Cirrus shareholders.

“The board has well founded concerns that the true purpose of the shareholder requisition proposed by Webcentral, an 8.86 percent shareholder in Cirrus, may be an attempt to gain control of the company by appointing two Webcentral nominee directors representing a majority on the board without paying an appropriate premium to their fellow shareholders to acquire such control,” the announcement read.

“Cirrus will undertake the necessary steps to convene a general meeting in compliance with the Corporations Act. Such a meeting is to be held within two months of receipt of the notice.”

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