CONSAC Digs In At MusclePharm
Earlier, we noted that Wynnefield Partners was dumping its MusclePharm ($MSLP) stake. This is still true, where Wynnefield sold off about 40% of its stake, roughly 4 million shares. The hedge fund noted, it chose to sell because MusclePharm may not be able to continue as a going concern for much longer. Bankruptcy is a very real possibility if it does not do a dilutive capital infusion, which would also be negative for shareholders.
Turns out, Wynnefield was dumping its shares for $5.48 a share (the stock is up to $6.85 and up 14% on the day) to fellow activist CONSAC. CONSAC went active on MusclePharm in May and owned 7.4%, about 1 million shares.
Per a press release from MusclePharm, CONSAC now owns 1.4 million shares (picking up the 400 thousand from Wynnefield) and installed Ryan Drexler, CONSAC president, as its chairman. The move is part of MusclePharm's plan to separate its CEO and chair positions. Noticeably, Drexler was president of Country Life Vitamins before CONSAC.