Rangeley Capital has raised its position in Ocean Shore Holding Co (NASDAQ:OSHC), now holding 7.7% of the company’s outstanding common stock, versus 7.0% held earlier. The aggregate amount of shares held by Rangeley has went up to 539,500, from 486,500 revealed in an earlier filing.
Since the position held by Rangeley is an activist one by nature, the firm clearly intends to get involved in the company’s activity and management. Rangeley is specialized in the analysis of securities and investment activities. As it is stated in the filing, the firm has been analyzing Ocean Shore as well. It has also revealed that Rangeley has sent a letter to Ocean Shore’s board in which it stated that the Board of the company must initiate a strategic review of the company and come up with some actions meant to increase the value for shareholders. One of the solutions which the Board should consider is the sale of the company.
In the letter, Chris DeMuth Jr., the manager of Rangeley Capital, stated that they have been long-term investors in Ocean Shore, holding the position since the company was converted from a mutual fund in 2009. Since the company is no longer under the moratorium on corporate actions, which expires three years after the conversion of the company, and taking into account the strong situation of Ocean Shore regarding its overcapitalization and loan portfolio, Rangeley believes that “ it is an ideal time to undertake a strategic review of potential avenues to maximize value for Ocean Shore’s owners.”
To maximize value, the Board of Directors should consider the possibility of a sale. Ocean Shore continues to trade close to tangible book value, a lower multiple than its peers. Even using conservative price estimates, a strategic buyer would likely pay a substantial premium to acquire the company today, the letter also said.