Ramius makes its case

I spoke last week about CPI Corp., and its planned stockholders' meeting July 8 (Wednesday).

Today I wish only to add that this is the case that Ramius is making. It objects to the fact that Turner White chairs the compensation committee, and that James Abel chairs the Nominating and Governance Committee.

Turner White, in particular, Ramius claims, has:

* No retail experience
* Limited financial experience
* Is a Knightspoint recommended director (a bad thing itself in their view)
* and as head of the Comp Committee has proposed and supported exorbitant compensation packages.

In general, the "outsized and undue influence" of Knightspoint supposedly throws into question "all aspects of the company's corporate governance."

CPI is arguing that Ramius has tried to force a desperation sale of the company. Ramius replies that this is "highly misleading," a phrase that usually means "not entirely wrong."

CPI Meeting, July 8

CPI Corp., a Missouri-based photography-services concern, hosts its shareholders meeting one week from today.

Its largest shareholder is Ramius LLC, which owns 23% of the equity and controls one board seat.

CPI's chairman, David Meyer, through his own investment firm, Knightspoint Partners, controls 1.5%, and two board seats.

A story in the St Louis Business Journal yesterday offers a scorecard.

The company is traded on the New York Stock Exchange (CPY). As you can see above, ithas a very dramatic looking price chart. Until the credit crunch of last autumn it was trading in a range between $14 and $18. About the time Lehman Bros declared bankruptcy in mid-September, CPI's price began a serious slide that took it down to $6. Then in mid October it recovered a good deal of that ground, which it lost again by the end of the month.

All that was but a bag-of-shells compared to the collapse of November, though. Through late Novemver and early December it was trading below $2.

the story since then has been one of recovery. So why the proxy fight? We'll talk Sunday.