‘Long-suffering’ Grange Johnson Gives Stamps.com A Licking

Aug 2 2007 | 11:54am ET

Grange Johnson is mad as hell, and he’s not going to take it anymore. The hedge fund manager is demanding action from mailing and shipping services company Stamps.com, whose stock price is languishing near its 52-week low, to improve its performance.

Johnson, the head of LaGrange Capital Management, demanded that Stamps.com announce a tender offer for as many as one-third of its outstanding shares. And if that doesn’t work –quickly – Johnson said the company should explore a sale.

“We are long-term and long-suffering holders of Stamps.com,” LaGrange, whose two funds own a combined 6.4% of the company, wrote in a letter to its board of directors. “The company’s consistently poor execution, which has driven its woeful stock performance, requires more aggressive corporate actions.”

Stamps.com--of which LaGrange wrote, “I can think of few better investments than buying STMP stock at its current multi-year low price,”--generates cash and is over-capitalized, he argued, meaning the company could complete the tender offer without taking on any debt. But Johnson made clear that he is not averse to pushing for a sale, even suggesting some possible buyers.

“Perhaps STMP is best run as part of a larger firm such as Intuit or j2 Global Communications,” he wrote. “Such firms could offer PC Postage as part of a broader package of products.”


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