Dear Soho House Director:
Third Point currently owns 9.9% of the Class A shares of Soho House & Co Inc. (“Soho House” or “the Company”). We were also cornerstone investors in the Company’s Initial Public Offering in 2021.
While we applaud the decision to return the Company to private ownership, it appears to us
that the Board has failed to perform its most important responsibility: to ensure a fair sales
process that achieves maximum value for all shareholders. Instead, the Board appears to
have engaged in an opaque process that resulted in a transaction (the “Sweetheart Deal”)
with the Company’s Chairman, Ron Burkle of Yucaipa.
As you are no doubt aware, transactions involving controlling stockholders (in this case due
to super-voting stock, not a majority economic interest) are subject to the most exacting
standards under Delaware law. It appears to us that the Board’s conduct will not come close
to satisfying these standards, thereby exposing both the Board and Mr. Burkle to liability for
failing to discharge their fiduciary duties of loyalty and care.
Mr. Burkle’s obvious conflicts of interest and undue influence on the board via his supervoting share class make it imperative that the Board open the sale process to outside bidders. We believe that numerous qualified parties with significant experience investing in the hospitality industry would be interested, and willing to pay a superior price to Mr. Burkle’s Sweetheart Deal.
An independent, fairlyvalued transaction by a qualified group would benefit not only Soho
House’s shareholders, but also its members, many of whom share the view that a fresh start
with visionary owners is necessary for the company to maintain its position in the hospitality
sector in the years ahead.
Sincerely,
/s/ Daniel S. Loeb
Daniel S. Loeb
CEO
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