Medallion Accuses Activist of 45-Cent Debt Repurchase Demand in Third Proxy Fight
MFIN•Medallion Financial calls Stephen Hodges’ third proxy campaign self-interested, rejecting his demand for a 45-cent debt repurchase and dismissing his slate. It highlights five-year net income of $266M and a 53% book value increase to $17.53, urging votes for its White proxy card.
1. Activist’s Third Proxy Campaign and Debt Demands
Stephen Hodges has launched his third consecutive proxy contest, seeking three of eight board seats and pressing Medallion to repurchase his subordinated debt at 45 cents on the dollar (approximately $6.5 million), a price more than double his purchase cost. He holds mostly illiquid trust preferred securities that pay 6%, and his push is viewed by management as self-interested rather than value-creating.
2. Criticism of ZimCal Nominees' Qualifications
Medallion highlights a lack of relevant public-company experience among ZimCal’s nominees, citing nominee Eric Kelly’s history of value destruction and pending litigation alleging fraud and financial improprieties. The company warns that these nominees have no track record of long-term shareholder value creation.
3. Medallion’s Financial Performance Highlights
Since 2021, Medallion has generated $266 million in net income over five years, increased book value per share by 53% to $17.53, and achieved a 14.1% CAGR in net interest income. The company has returned $68.5 million to shareholders via dividends and buybacks, reinforcing its case for management continuity.
