Increases Share Repurchase Authorization to
$55 Million to Honor Continued Commitment to Return Capital to
Shareholders
Share Repurchase Authorization Replaces
Previously Announced Tender Offer Given Underlying Shares Are Now
Trading 11% Above Previously Communicated Top End of Proposed
Tender Offer Range
Board of Directors Will Continue to
Aggressively Assess Mechanisms to Create Shareholder Value
Leading gaming accessory maker Turtle Beach Corporation (Nasdaq:
HEAR) (“Turtle Beach” or the “Company”) announced today its Board
of Directors has modified its previously communicated near-term
return of capital plan to shareholders, given the overwhelmingly
positive reaction to the Company’s recent transformational
acquisition of Performance Designed Products (“PDP”) and the strong
underlying trading price of the Company’s shares.
With today’s announcement, the Board of Directors (the “Board”)
no longer intends to launch the previously announced modified
“Dutch auction” Tender Offer (the “Tender Offer”) to purchase up to
$30 million of its common stock (the “Common Stock”) at a price per
share not less than $13.75 per share and not greater than $15.00
per share. Since the acquisition of PDP and the intent to launch
the Tender Offer was announced on March 13, 2024, the average
trading price of the Company’s shares has surpassed the highest end
of the Tender Offer range indicated, with the most recent closing
price of the shares 11-21% above the range, and the Board believes
the proposed Tender Offer would only receive limited participation.
The Board has determined that launching a tender offer estimated to
receive only limited participation would not achieve the Company’s
objectives while at the same time creating significant and unneeded
costs for the Company that are not in the best interests of
investors.
In its continued effort to evaluate capital allocation
priorities, the Board has determined that the best course of action
to continue to return capital to shareholders is to increase the
Company’s share repurchase program by $30 million. Under the
revised share repurchase authorization, the Company is authorized
to acquire up to a total of $55 million of shares of its common
stock, including the $8.4 million already acquired under the
program, at its discretion from time to time in the open market, or
in block purchases or privately negotiated transactions, subject to
compliance with the applicable restrictions in the Company’s debt
agreements. The current balance remaining for the repurchase
program, including today’s increased authorization, is $46.6
million.
Terry Jimenez, Chairman of the Board, states: “The Board of
Directors is excited about the future of the Company and we are
encouraged by the positive response of our investors to the
significant changes underway at Turtle Beach. On behalf of the
Board, we look forward to meaningful value creation opportunities
for the Company and its shareholders. Increasing our share
repurchase program is confirmation of the confidence the Board has
in the Company’s cash generation outlook, expanded earnings power,
and continued operational excellence.”
The Company expects to announce further details regarding the
stock repurchase authorization in connection with the issuance of
its first quarter 2024 earnings in May.
The amount and timing of specific repurchases are subject to
market conditions, applicable legal requirements and other factors.
Turtle Beach intends to fund the share repurchases using cash from
operations or short-term borrowings and may suspend or discontinue
repurchases at any time.
About Turtle Beach
Corporation
Turtle Beach Corporation (the “Company”)
(www.turtlebeachcorp.com) is one of the world’s leading gaming
accessory providers. The Company’s namesake Turtle Beach brand
(www.turtlebeach.com) is known for designing best-selling gaming
headsets, top-rated game controllers, award-winning PC gaming
peripherals, and groundbreaking gaming simulation accessories.
Innovation, first-to-market features, a broad range of products for
all types of gamers, and top-rated customer support have made
Turtle Beach a fan-favorite brand and the market leader in console
gaming audio for over a decade. Turtle Beach Corporation acquired
Performance Designed Products (www.pdp.com) in 2024. Turtle Beach’s
shares are traded on the Nasdaq Exchange under the symbol:
HEAR.
Cautionary Note on Forward-Looking
Statements
This press release includes forward-looking information and
statements within the meaning of the federal securities laws.
Except for historical information contained in this release,
statements in this release may constitute forward-looking
statements regarding assumptions, projections, expectations,
targets, intentions or beliefs about future events. Statements
containing the words “may,” “could,” “would,” “should,” “believe,”
“expect,” “anticipate,” “plan,” “estimate,” “target,” “goal,”
“project,” “intend” and similar expressions, or the negatives
thereof, constitute forward-looking statements. Forward-looking
statements involve known and unknown risks and uncertainties, which
could cause actual results to differ materially from those
contained in any forward-looking statement. The inclusion of such
information should not be regarded as a representation by the
Company, or any person, that the objectives of the Company will be
achieved. Forward-looking statements are based on management’s
current beliefs and expectations, as well as assumptions made by,
and information currently available to, management.
While the Company believes that its expectations are based upon
reasonable assumptions, there can be no assurances that its goals
and strategy will be realized. Numerous factors, including risks
and uncertainties, may affect actual results and may cause results
to differ materially from those expressed in forward-looking
statements made by the Company or on its behalf. Some of these
factors include, but are not limited to, risks related to
inflationary pressures, optimizing our product portfolio, reducing
our cost of goods and operating expenses, reductions in logistic
and supply chain challenges and costs, the substantial
uncertainties inherent in the acceptance of existing and future
products, the difficulty of commercializing and protecting new
technology, the impact of competitive products and pricing,
including promotional credits and discounts, general business and
economic conditions, risks associated with the future direction or
governance of the Company, risks associated with the expansion of
our business, including the integration of any businesses we
acquire and the integration of such businesses within our internal
control over financial reporting and operations, our indebtedness,
liquidity, and other factors discussed in our public filings,
including the risk factors included in the Company’s most recent
Annual Report on Form 10-K, Quarterly Report on Form 10-Q, and the
Company’s other periodic reports filed with the Securities and
Exchange Commission. Except as required by applicable law,
including the securities laws of the United States and the rules
and regulations of the Securities and Exchange Commission, the
Company is under no obligation to publicly update or revise any
forward-looking statement after the date of this release whether as
a result of new information, future developments or otherwise.
All trademarks are the property of their respective owners.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240409551246/en/
MacLean Marshall Sr. Director, Public Relations
& Brand Communications Turtle Beach
Corporation 858.914.5093
maclean.marshall@turtlebeach.com
Investor Information:
Alex Thompson Gateway Group 949.574.3860
hear@gateway-grp.com
Turtle Beach (NASDAQ:HEAR)
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Turtle Beach (NASDAQ:HEAR)
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