Hedge Funds Investor Calls On CTPartners To Engage in Sale With Rival Suitor

March 23, 2015 – Maguire Asset Management, a significant shareholder of embattled Top 10 U.S. search firm CTPartners, delivered a letter to its board of directors on Friday demanding “a robust sale process” of the company and the immediate appointment of new independent board members. “Based on a series of poor management decisions, reported allegations of inappropriate management behavior and a number of outside factors, it is our opinion that CTPartners is significantly undervalued in the public market,” wrote hedge found founder Tim Maguire, who said that a “loss of leadership credibility” at the company had led to its “undervaluation." He called on the CTPartners board to examine its strategic alternatives by fulfilling its “fiduciary duty to all shareholders by exploring a sale of the entire company.” Based upon a detailed analysis of CTPartners and the trading value of its competitors, Mr. Maguire said he believes CTPartners could be sold to a strategic buyer for a price between $12 and $16 per share. He said he came to the sale conclusion based on an “ongoing overhang of investor skepticism and uncertainty about the company's ability to rebound completely as a stand-alone enterprise.” Mr. Maguire pointed to the recent unsolicited offer by rival search firm DHR International as a starting point that must not be ignored by the CTPartners board, even though DHR’s offer falls far short at $7 per share. To date, no meaningful discussion about a possible deal has taken place between CTPartners and DHR even though DHR approached the company with a $61 million offer more than six weeks ago. “In our opinion, the best way to maximize shareholder value in situations like this is to engage DHR as one of many potential bidders in a well-run auction process,” said Mr. Maguire. “This will level the playing field between DHR and other participants,” he said, and reassure shareholders that the board is indeed acting in their best interests. “Finding another strategic buyer might be tricky at this point,” said Scott A. Scanlon, chairman and CEO of Greenwich-based research firm Hunt Scanlon Media. “CTPartners’ brand is slipping in the marketplace and the company is losing clients and top producers as a result.” Mr. Scanlon said that one client switched to Egon Zehnder and Spencer Stuart just this month while four top CTPartners’ recruiters, two of them vice chairmen, exited for larger rivals in the last two weeks. “I’m not so sure that valuations north of DHR's offer make sense right now,” said Mr. Scanlon. “Had CTPartners stayed ahead of the news instead of being led by it over the last 90 days we might be seeing the value that Mr. Maguire sees. Instead, we see a substantially weakened brand. No one is lining up to acquire this company except DHR. I think you play with the cards you’re dealt.”

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