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February 21, 2014
05:07 EDTSXTSensient would oppose any director candidates of FrontFour
Sensient Technologies has received a letter from FrontFour Master Fund expressing its intention to nominate four individuals to Sensient’s board at the 2014 Annual Meeting of Shareholders. Sensient has not announced the date of the 2014 Annual Meeting of Shareholders. In the event FrontFour were to file a proxy statement in support of its proposed slate of directors, the board of Sensient would strongly oppose FrontFour’s four director candidates. FrontFour is plainly seeking to exploit Sensient’s strong financial position and industry-leading businesses for short-term gains that are not in the long-term interests of Sensient’s shareholders and other stakeholders. FrontFour’s stated plans would be disruptive and would imperil the continued successful implementation of Sensient’s strategy. Furthermore, FrontFour’s opinion that the company’s capital structure is sub-optimal is incorrect, as it completely ignores the clear benefits of Sensient’s very strong balance sheet and credit profile. Sensient is an extremely strong company with a very healthy balance sheet. As a result, it is an attractive target for short-term investors looking to “extract” value through an “event” without any consideration for the long-term financial strength of Sensient. FrontFour’s letter suggests several possible “events” that would be in its own self-interest, but plainly not in the best interests of Sensient’s long-term shareholders, customers, employees and other stakeholders. An unduly large stock buyback or the sale of one or more business units at this time would create uncertainty and a lack of financial flexibility as Sensient continues to invest in its businesses. Any such event would create an enormous obstacle to the continued implementation of the company’s strategy. Additionally, based upon a preliminary analysis, FrontFour’s nominees for Sensient’s board appear to be career activists with very close relationships to FrontFour, spotty track records on creating shareholder value, questionable motives and little to no experience in the very Flavors and Fragrances business they are allegedly aiming to “fix.” Furthermore, their attributes, skills and experience pale in comparison to those of Sensient’s current board and potential future directors that have been and will continue to be vetted by Sensient’s Nominating and Corporate Governance Committee. Significantly, FrontFour has never approached Sensient with any concerns about our results, financial condition, strategy or any other business issue. Instead, FrontFour has chosen to spring its alleged concerns on Sensient in an abrupt manner calculated to cause disruption and to promote FrontFour’s self-interested agenda.
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