Legatum fires back at Sonus, says company ignored shareholder's issues

By Lisa Kerner

Charlotte, N.C., June 23 - Sonus Networks, Inc. investor Legatum Capital expressed disappointment in a June 20 response from the company, accusing Sonus of ignoring the "substantive issues" raised by the shareholder.

Legatum said Sonus, instead of addressing these issues, attempted to "obscure matters by raising counterfeit issues" about the company's largest shareholder.

In the letter, Legatum noted its 20-year record of investing and denied being a hedge fund or a sovereign wealth fund.

Legatum said Sonus' requested "onerous standstill agreement" would "strip Legatum of its basic shareholder rights" and make the investor's nominated directors "little more than spectators at the board meetings."

"To be crystal clear about Legatum's aims: whether our nominees are on the board or not, we have no interest in managing the business, but are seeking to ensure that the company has a board which shares our passion to see Sonus fulfill its potential and in the process increase shareholder value," Legatum's letter stated.

It was previously reported that Sonus claimed Legatum Capital misconstrued the company's offer to appoint a qualified Legatum designee to its board of directors.

In a June 20 letter to United Arab Emirates-based Legatum, Sonus clarified that its offer was to create a specific board seat and add a Legatum designee based on the individual being qualified by the Sonus nominating committee and Legatum's willingness to enter into a standstill agreement.

Sonus cited the company's place within the national security infrastructure of the United States and the "foreign nature" of the Legatum family of investment funds.

The company noted that it separated the role of chairman and chief executive officer, which Legatum had suggested.

Legatum, a 25% shareholder, had announced it would withhold its vote for all nominees standing for election to the Sonus board at the company's meeting on June 20 because it did not believe the board had taken steps to change the way the company is managed or to deliver value to shareholders.

Sonus, based in Westford, Mass., specializes in voice infrastructure solutions for wireline and wireless service providers.

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