comScore, which has been trying to put its financial house in order since accounting issues cropped up, said it has formed a special committee to do a long-term strategic review of the company.
The review process is being driven by Starboard Value LP, which owns 4.9% of comScore stock.
comScore also said it has delayed reporting its financial results and plans to settle lawsuits against it for $27.2 million in cash, which would come from the company’s insurers, and $82.8 million in stock.
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The media measurement company has not released financial statements since its account issues emerged, which has resulted in comScore’s shares being delisted from public exchanges. The company said Monday it will restate its earnings for 2015, 2016 and 2017 in March 2018 at the earliest. The company noted that it is also working on preparing its financial statements from 2017.
Earlier this year, the company said that the cost of the investigation and redoing its financial statements was about $30 million.
“We regret the need to extend further the date for filing our restated financials and we share the frustration of our stockholders. However, to ensure the completeness and accuracy of the past four years of financial information we will be reporting and to ensure that we are also able to include audited financial statements for 2017, the Board has determined that additional time is needed,” said CEO Gian Fulgoni. “In the meantime, I firmly believe in comScore's future based on the compelling opportunities we see for organic growth within our existing and new products,
The financial irregularities came to light after comScore acquired Rentrak, a move that some saw as having the potential to make the new combined company a challenger to Nielsen, which dominates the media measurement industry.
comScore also announced that it reduced the size of its board to five directors, eliminating seven current members. Sue Riley, an independent director, was appointed board chairman. The board is now Fulgoni, Bill Livek, president and executive VP; Brent Rosenthal, an investor and former non-exeuctive chairman of the board of comScore, independent director Jacques Kerrest and Riley.
Riley and Kerrest form the special committee studying the company’s strategic options.
"Since joining the Board, the members of the Special Committee have immersed themselves in the challenges and opportunities the Company faces and are working closely with the Company's management and the other Board members to move the Company forward,” Riley said.
David Kay, co-founder and managing partner of CrossCountry Consulting, was named interim CFO and treasurer of comScore. He succeeds David Chemerow, who resigned.
Securities class action lawsuits were brought against the company and some of its current and former directors and officers of the company in Fresno County Employees' Retirement Association.
"We believe this proposed settlement eliminates the burden of further time, expense and risk related to the class action, allowing the comScore team to focus on the restatement and executing on our operational initiatives for growth," said Fulgoni.
In another suit, comScore has agreed to pay $19 million, all but $1.66 million of which is covered by insurance.
(Photo via FamZoo Staff's Flickr. Image taken on May 25, 2016 and used per Creative Commons 2.0 license. The photo was cropped to fit 16x9 aspect ratio.)
