The Shareholder Forum


North State Telecommunications

Forum Home Page


North State Tel Home Page

North State Tel Reference


For the referenced letter distributed by Leeward Investments to shareholders of North State Telecommunications, see


Source: The High Point Enterprise (North Carolina), November 21, 2012 article

Description: High Point Enterprise  


Pressure continues on North State to sell

Nov. 21, 2012 @ 04:21 PM

Paul Johnson

HIGH POINT — An investor in North State Communications again is calling for the High Point-based company to consider a sale of the business that has been based in the city since its founding 117 years ago as a rural telephone exchange.

Leeward Investments, a California-based enterprise with a relatively small holding in North State, contends that “the long term prospects for this company (North State) in the hands of its current shareholders are decidedly unfavorable.” In a letter sent earlier this month to North State, Leeward Investments said recent initiatives by North State’s management haven’t bolstered the company’s bottom line.

North State “operates in an industry that continues to undergo rapid, profound and unpredictable technological change. A small company cannot expect to manage in such an environment,” writes Kent Rowett, manager of Leeward Investments. Rowett told The High Point Enterprise that Leeward Investments has a single-digit percentage holding in North State, though he didn’t elaborate on a specific investment figure.

North State issued a statement Monday to the Enterprise reiterating its position that the company is operating well under current ownership and management.

“Our position has not changed. Our board of directors and executive team remain excited and committed to continuing to grow the company,” North State said in its statement.

In its letter, Leeward Investments cites actions taken by North State that haven’t panned out in earnings. The company made $215 million in capital expenditures in the last 10 years, but annual earnings per share have declined from a high of $8.28 in the past decade to $3.71 last year, Leeward Investments contends. The coverage ratio of earnings to dividends has dropped in half from 150 percent 10 years ago to 71 percent, the letter states.

Dissident shareholders have sought a sale of North State during the past three years, though company management has rejected the overtures.

The future of North State carries major implications for the city. In addition to serving as one of the most prominent companies with a headquarters in High Point, North State is a major employer. The High Point Economic Development Corp. ranks North State, which had 414 employees at the end of last year, as the 17th-largest employer in the city.

North State also has a long history of corporate philanthropy, supporting a range of charitable causes. North State is a primary sponsor of the annual Fox 8 Gifts for Kids Christmas toy drive taking place now for the holiday season. | 888-3528


© 2012 High Point Enterprise

210 Church Ave.

High Point, NC. 27262




This Forum program is open to all shareholders of North State Telecommunications Corporation, and to any fiduciaries or professionals concerned with their investment decisions. Participation is free of charge, according to the Forum's standard Conditions of Participation.

The purpose of the program is to provide shareholders with access to information and a free exchange of views relating to their consideration of issues described in the Forum Summary. As stated in the Conditions, all Forum participants are expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants. Forum polices are intended to support anonymous communication, and provide that participants will not be identified or quoted without their explicit permission.

Inquiries and requests to be included in the Forum's distribution list may be addressed to

The information provided to Forum participants is intended for their private reference, and permission has not been granted for the republishing of any copyrighted material. The material presented on this web site is the responsibility of Gary Lutin, as chairman of the Shareholder Forum.

Shareholder Forum™ is a trademark owned by The Shareholder Forum, Inc., for the programs conducted since 1999 to support investor access to decision-making information. It should be noted that we have no responsibility for the services that Broadridge Financial Solutions, Inc., introduced for review in the Forum's 2010 "E-Meetings" program and has since been offering with the “Shareholder Forum” name, and we have asked Broadridge to use a different name that does not suggest our support or endorsement.