STAAR Surgical’s Long-Term Shareholder Says Proposed Deal With Alcon Undervalues The Company

Defender Capital, a long-term shareholder of STAAR Surgical Company, on Tuesday expressed opposition to the firm’s proposed acquisition by Alcon Inc.

Defender Capital owns 1.5% of STAAR’s common stock. “The proposed sale of STAAR to Alcon for $28 per share significantly undervalues the company, especially when considering the STAAR board of directors' rejection of Alcon's previous offer for $58 per share in cash only sixteen months ago,” the shareholder said.

Defender Capital further added that it sees no compelling reason to sell STAAR at this time, with recent optimistic projections and outlook. The shareholder also expressed disappointment at the company board, alleging that the proposed transaction is ‘ill-advised’ and does not reflect STAAR’s prospects as a standalone company.

Shares of STAAR Surgical Company traded nearly 2% lower on Tuesday. On Stocktwits, retail sentiment around STAA stock stayed within the ‘bearish’ territory while message volume remained at ‘normal’ levels.

Defender Capital is not the only one to oppose the proposed acquisition. Last month, Hong Kong-headquartered investment management firm Yunqi Capital, which holds a 5.1% stake in STAAR, alleged in a letter to other shareholders that it would not necessarily be opposed to a potential merger of the two companies at an appropriate price or on other appropriate terms, but opposed the deal on the terms announced in August.

Before Yunqi, Broadwood Partners, L.P., and its affiliates also announced their intention to vote against the proposed acquisition. Broadwood is STAAR’s largest shareholder, owning 27.5% of the company’s outstanding common shares.

STAAR is a manufacturer of phakic intraocular lenses, a vision correction solution that reduces or eliminates the need for glasses or contact lenses. Alcon said in early August that the companies have entered into a definitive merger agreement under which Alcon will purchase all outstanding shares of STAAR common stock for $28 per share in cash. The transaction is expected to close in about six to 12 months and represents a total equity value of approximately $1.5 billion, it added.

STAA stock is up 8% this year and down approximately 23% over the past 12 months.

Read also: Ford Shares Slump 5% After Reports Of Fire At Aluminum Supplier Plant: Retail Dismisses The Dip As ‘Short-Lived’

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Editor's Note: The story has been updated to reflect Broadwood Partners' accurate stake in STAAR Surgical Company.

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