An investment group that owns nearly 6 percent of Lamson & Sessions Co.'s stock is petitioning the Beachwood, Ohio-based company to sell its PVC pipe business, calling it a ``distraction to the management team.''
Troubled by the volatile pipe market, and even more so by Lamson's behind-the-scenes maneuvering that seem to foretell pending acquisition efforts, investors at New York-based Ramius Capital Group LLC are calling for a major stock repurchase and an immediate sale of the pipe extrusion business.
In a Dec. 4 letter to Lamson management, Ramius suggested that the company's pipe business could fetch between $35 million and $70 million.
``From a valuation perspective, we feel that a sale of the PVC pipe business will significantly enhance shareholder value by bringing in additional cash resources to the company while removing the negative perception and distraction associated with the company's exposure to the highly cyclical and volatile PVC pipe market,'' the letter said.
Lamson officials have scheduled a special shareholders meeting Dec. 15, where they will ask for authorization to issue an additional 20 million shares, which if approved, would double the company's share authorization. Because the company has a regularly scheduled shareholders meeting in April, Ramius officials are convinced that Lamson is pursuing an acquisition.
``We have chosen to express these views now because we are disturbed by the apparent sense of urgency to execute on acquisitions,'' the letter said.
Lamson officials could not be reached for comment.
Ramius officials declined to comment.