CVR Medical Corp V.CVM.H

RE:Merger

[Looneytunes]

From the same statement its easy to read things in isolation however I think that the following 3 passages need to be read together :

• frustration on the part of the internal audit committee with the current structure of the organization.
• Specifically, the inability for CVR Medical to fully merge with its supplier and shareholder CVR Global
• The Board has struck an independent committee to consider the Company’s relationship with CVR Global.

 

Without an understanding of what those frustrations were it's difficult to comment but perhaps we should assume that in the context of the remainder of the letter they were related to the relationship between CVR Medical and CVR Global and that to cause such a severe split in the board they must have been significant. I wasn't aware that there was an attempt to merge the two companies and don't believe that it has ever been stated but as a shareholder, for me it makes perfect sense, reducing the complexity of the organisation (and therefore the cost of administration) and achieveing the synergies that bringing the two teams together, must realise. CVR Global has both a Director of Finance and a CFO, surely in an organisation dedicated only to product development, IP protection and FDA approval; these posts could also adequately cover CVR Medical as a combined operation. CVR Global also has two marketing people - I would have thought that in a combined operation, these people could also cover shareholder communications. And finally, I'd like to see the Terms Of Reference for an Independent committee to consider the company's relationship with CVR Global as that somewhat contradics the other statement about there being an intent to merge the two operations. Also, if Peter has created those T.O.R., how can that committee be truly independent?