Equus Total Return is a business development company (BDC) HQ-ed in Houston that trades as a closed-end fund on the New York Stock Exchange. I haven't said anything about BDCs in this blog yet, so perhaps this entry is a good way to start, because they are a peculiar corner of our financial system.
"In what way 'peculiar'? Am I a clown for you? Am I here for your amusement?"
Let me just focus for now on the news, Mr Pesci. Equus faces a proxy fight at the May 12 annual shareholders meeting. The stock price has been rather stagnant recently. It has been trading in a range roughly between $3 a share and $3.50 a share since June 2009.
The Committee to Enhance Equus, owning 11.4% of the outstanding shares of Equus Total Return, Inc., the dissident group, says that it shares its fellow shareholders' disappointment over this stagnation.
"The Committee also notes the current five-member majority of the Board, which includes Kenneth I. Denos, are attempting to further entrench themselves by packing the Board with four new nominees (who do not personally own any Equus shares) without properly investigating their backgrounds."
Equus has responded by noting that the committee has connections with one of Equus' own portfolio companies, Trulite Inc. , a hydrogen fuel cell firm. One of the nominees for director on the dissidents' slate is Jonathan H. Godshall, CEO of Trulite. Its chairman, John D. White, is another. Paula Douglass, a Director of Trulite, is yet a third. The charge, then, is that they want to take over Equus in order to run Equus for Trulite's benefit, not that of its own stockholders.
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