Leap against board shakeup

Leap Wireless International Inc. (LEAP) looks to be distancing itself from plans by Pentwater Capital Management L.L.C. to nominate three directors for election to Leap’s board of directors.
Pentwater said in a statement yesterday that it was looking to shake up Leap’s current board that it claims has mismanaged its operations and focus on broadband services. The Pentwater statement sent Leap’s stock surging more than 9% by the end of Thursday, with the price having lost more than 5% this morning.
“Leap respects the rights of shareholders to nominate director candidates; however, we strongly disagree with many of the assertions contained in Pentwater’s letter,” Leap said in a statement. “Leap has a highly-qualified board that was strengthened in November 2009 with the addition of three new, independent directors who brought significant additional experience and strong operating and strategic perspectives to the board. The board is committed to acting in the best interests of all shareholders.”
Leap noted its change of focus last August that saw the carrier announce new rate plans and a focus on smart phones that it hopes will turn around its flagging operations. Leap managed to post strong customer growth results for the final three months of 2010, but noted that the costs associated with that growth was impacting its bottom line.