Concurrent Exploring Strategic Alternatives “to Maximize Shareholder Value” …

Concurrent Computer Corp., provider of high-performance Linux and storage solutions, is exploring strategic alternatives to maximize shareholder value.

The board of directors has created a special committee of directors and the company has engaged Needham & Company, LLC to advise it on the process.
 
“Concurrent is well positioned in the industry and continues to win new business in our target markets,” said Derek Elder, president and CEO. “This review of strategic alternatives is consistent with our plan to simplify our operating model, sharpen our focus and accelerate our growth plan. We remain committed to providing customers with the best solutions, service and support regardless of the outcome of the process.”

There is no defined timeline for this strategic review and there can be no assurance that the company’s review of strategic alternatives will result in any transaction.

Concurrent also announced that its board of directors has adopted a tax asset preservation plan designed to protect shareholder value by preserving the value of Concurrent’s substantial tax assets. As of December 31, 2015, Concurrent had U.S. federal net operating loss carryforwards of approximately $89.9 million and additional tax attributes, including state net operating loss carryforwards.

Concurrent’s ability to use these tax attributes may be limited if there were an ‘ownership change’ as defined under Section 382 of the Internal Revenue Code which would impair the value of these benefits to all shareholders. Similar to tax asset preservation plans adopted by other public companies, Concurrent’s tax asset protection plan is designed to reduce the likelihood that Concurrent will experience an ownership change by discouraging any person from becoming a 5% shareholder. In addition, Concurrent intends to recommend an amendment to its certificate of incorporation at this year’s annual meeting of stockholders that would establish ownership limitations designed to preserve the value of Concurrent’s net operating loss carryforwards in a manner similar to the tax asset preservation plan.

“Additionally, our net operating loss carryforwards represent a substantial asset of our company and the board believes that the preservation of these assets to offset future tax liabilities that may occur as a result of our strategic alternatives review is in the best interest of stockholders,” said Elder. “Taking the steps announced is a prudent step specifically tailored to protect our tax attributes until stockholders have the chance to decide at this year’s annual meeting whether or not they would like to adopt structural reforms to preserve the value of these assets going forward.”

The tax asset preservation plan will automatically terminate five business days following the reporting of voting results at the annual meeting, including any adjournment or postponement, regardless whether stockholders approve the amendment to be proposed to Concurrent’s certificate of incorporation.