Encore Capital: Red Mountain Capital seeks to influence company direction, seeks board representation

By Lisa Kerner

Charlotte, N.C., April 16 - Encore Capital Group, Inc. investors led by Red Mountain Capital Partners LLC acquired the company's stock believing it to be undervalued. The investors, which hold 3,435,062 shares, or 15.1%, of Encore's outstanding stock, have met with management to discuss the company's operations, strategic direction, capital structure and corporate governance.

Red Mountain plans to continue its dialog with the company and expects Encore to pursue "appropriate measures to enhance shareholder value," according to a schedule 13D filing with the Securities and Exchange Commission.

The investors may also communicate with Encore's board, other shareholders and potential strategic or financing partners, the filing stated.

Red Mountain also intends to seek representation on the board of directors.

Between March 8 and April 11, Red Mountain and its affiliates purchased 1,144,063 shares of the company's stock priced from $9.31 to $9.96 per share.

Encore is a San Diego-based purchaser and manager of charged-off consumer receivables.

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