Rosetta Stone Up 5%; New Investor Seeks Bigger Board
Rosetta Stone (NYSE: RST) shares jumped more than five percent after an investment group disclosed it had acquired an eight percent stake for about $18 million and urged the company's management to "tighten its focus."
The investment group, D3 Family Funds, acquires shares of micro-caps and said in its 13D filing had recommended a number of candidates to increase the size of Rosetta's board.
D3 said it has been "in frequent contact with management" of the company which provides self-study language courses. It believes Rosetta is taking "too many initiatives simultaneously."
As an example, D3 said "we find it difficult to believe..all of the many product and pricing, distribution and channel initiatives being pursued in RST’s North American consumer (NAC) business are equally worthy."
Rosetta has "enormous potential" but its share price reflects Street sentiment that the company is "wasting its assets," D3 said.
Rosetta traded recently at $10.04 per share, up 4.8 percent.
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