Teletech Corporation 1996
Teletech Corporations has headquartered in Dallas, Texas, defined itself as a "provider of integrated information movement and management. The firm had two main business segments: The Telecommunication Services and the manufacture of computing and telecommunications equipment named, Product and Systems.
Margareth Weston, a Teletech chief financial officer, learned of Yosarrian's letter in January 1996. Margareth organized a team immediately of lawyers and finance staff to assess the threat. Maxwell Harper, the firm's CEO, scheduled a teleconference meeting of the firm's board of directors the next day. Harper and Weston agreed that before the meeting they need to fashion a response to Yossarian's assertions about the firm's returns.
It is in connection with the article published that reclusive billionaire Victor Yossarian has acquired a 10 percent stake in Teletech Corporation and has demanded two seats on the firm's board of directors. The purchase was revealed upon filing with the Securities and Exchange Commission and separately a letter to Teletech's CEO, Maxwell Harper. It is stated that the firm is misusing its resources and not earning an adequate return and the company should abandon its misguided entry into computers and sell the Product and System Segment. Also, the management must focus on creating value for shareholders and Teletech must issued a brief statement emphasizing the virtues of a link between computer technology and telecommunications.
Ironically, returns had been the subject of debate within the firm's circle of senior managers in recent month. A number of issues had been raised about the hurdle rate used by the company in evaluating performance and in setting the annual capital budget. Since the company was expected to invest nearly $2 billion in capital in 1996, gaining closure and consensus on these issues had become an important priority for Margareth Weston. Now, Yossarian's letter...
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