Turtle Beach holder Donerail Group drops bid, plans to nominate full board slate
Turtle Beach Corp. (NASDAQ:HEAR) holder Donerail Group, which has made several attempts to purchase the gaming headphone maker that were rejected, said it has dropped its bid to purchase the company and plans to nominate a full slate of directors to the board.
"Although we previously made highly-competitive proposals to acquire Turtle Beach, we have withdrawn our most recent offer and are now 100% committed to turning around the company in the public market and for the benefit of all shareholders," William Wyatt, Donerail's managing member wrote in a letter to holders.
The potential proxy battle comes after Donerail, which owns a 7.4% stake in Turtle Beach, in December made a revised $32.86 offer for the gaming headphone maker, revised down from Donerail's original $36.50 bid from the summer.
Donerail's announcement also comes after Turtle Beach (HEAR) shares dropped 11% yesterday after Wedbush downgraded the stock to neutral ahead of the company's 4Q earnings after the close today. Wedbush analyst Michael Pachter said the company is trading "well ahead" of the gaming peripherals group including Corsair (NASDAQ:CRSR) and Logitech (NASDAQ:LOGI) and sees "limited room" for further upside.
Turtle Beach shares reversed earlier declines are now up 2.1%.
Turtle Beach responded to Donerail's latest letter.
“The Turtle Beach Board of Directors and management team are committed to delivering enhanced value to our shareholders, and will continue to take actions to achieve this objective," the company said in a statement emailed to Seeking Alpha.
See, Turtle Beach Q4 2021 Earnings Preview.