GREENWICH, Conn., June 5 /PRNewswire/ -- Mercury Real Estate Advisors LLC, an affiliate of Mercury Partners LLC, a real estate investment management company based in Greenwich, CT, sent the following letter today to Wilshire Enterprises, Inc.'s (AMEX:WOC) Board of Directors.
MERCURY REAL ESTATE ADVISORS LLC
100 Field Point Road
Greenwich, Connecticut 06830 June 5, 2006 Board of Directors
Wilshire Enterprises, Inc. c/o Mr. Eric J. Schmertz
1 Gateway Center
11-43 Raymond Plaza West
10th Floor
Newark, NJ 07102 Ladies and Gentlemen: As the largest independent shareholder of Wilshire Enterprises, Inc. ("Wilshire" or the "Company"), we are disturbed by Sherry Wilzig Izak's defensive, self-aggrandizing tone and inaccurate characterizations in her speech at the 2006 annual meeting. The comments made by Ms. Izak are those of a Chief Executive Officer attempting to deflect attention in any way possible from her countless failures over the years as the supposed steward of the Company. For example, Ms. Izak cited the performance of the Company's stock price since September 2004 as evidence of her ability to create value for shareholders. However, we are all aware that Ms. Izak became CEO in May of 1991 - not September 2004 - and that if we look at Wilshire's stock price when Ms. Izak took control relative to the current price, it has provided a pathetic annualized total return of approximately 4.5%, or nearly six percentage points below the annualized return of the S&P 500 over this time period. We view this dramatic underperformance relative to the general market over the last 15 years as evidence of Ms. Izak's inability to create value for shareholders and we consider her attempt to use the very recent performance of the stock price to presumably justify her existence as extremely disingenuous.
Further, we have never urged Wilshire to conduct a 'fire sale' of its assets, as Ms. Izak repeatedly and incorrectly noted during her speech. In truth, we have asked the Company to pursue an intelligent liquidation process in one of the strongest seller's market in the history of commercial real estate. As discussed in our last letter, the Company's lack of commitment to its value maximization strategy is evident in the significantly delayed cash distribution as well as the delayed decision to conduct a sale of some of its assets, which we first suggested approximately 7 months ago. It is abundantly clear that without pressure from Mercury, Ms. Izak would still be attempting to grow the Company through acquisitions, paying herself outrageous compensation, and not paying out special dividends. It is glaringly obvious that Ms. Izak is attempting to spin our comments to cover up her part-time work ethic and perpetuate this underperforming company as long as possible.
We are also astounded that our proposal to acquire the Company for $8.50 per share in cash, which was made on February 27, 2006, was completely ignored. Management's continued unwillingness to explore a premium bid for the entire Company, as well as its refusal to publicly issue its evaluation of our offer, is a dereliction of its fiduciary responsibility to shareholders. Also, we again demand that Wilshire increase the announced cash distribution to $4.00 per share - another proposal to which Wilshire has not responded - and return this cash to the long-suffering shareholders of the Company.
Ms. Izak's speech at the 2006 annual meeting is simply an attempt to divert attention from her historically poor track record and the excessively high G&A expense at Wilshire. At this critical time for the Company, we need to immediately eliminate the 'pay-for-pulse' compensation of Ms. Izak, who has failed to demonstrate an ability to create value for shareholders during her tenure with the Company. In fact, we believe the most value would be created for shareholders if all the senior members of the management team were terminated and the Company's assets were placed into a liquidating trust. This would eliminate the prohibitively high G&A expense and place control of the assets with experienced liquidating agents that could sell the remaining properties, either individually or as a portfolio, in an efficient and timely manner.
Again, we urge the Board of Directors to recognize that Ms. Izak's track record demonstrates that she is clearly unfit to lead the company through this critical stage and must be terminated. We look forward to immediately discussing this issue along with our proposed liquidation strategy at a meeting with Ms. Izak and Mr. Schmertz.
Sincerely, David R. Jarvis Malcolm F. MacLean IV
Chief Executive Officer President
DATASOURCE: Mercury Real Estate Advisors LLC CONTACT: Malcolm F. MacLean IV of Mercury Real Estate Advisors LLC, +1-203-769-2980 Web site: http://www.mercuryrealestate.com/
|