Proxy Blog

Covetrus, Inc. 

November 12, 2020

The special proxy for this animal health company had a proposal to convert the preferred shares from a financing transaction into common shares. 

Magni voted for the proposal. The chairman recommended voting for the conversion based on the cash savings on dividends. While such a consideration in important, there are bigger issues. Having a single class of stock so all shareholders have comparable rights is part of good governance. The agreement to obtain the financing in exchange for preferred shares was made a while ago, so the wisdom, or lack thereof, is not a current consideration. The agreement is binding on the company. As such, Magni supports the governance improvement and cash savings.