UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December, 2006
SPIRENT COMMUNICATIONS plc
_____________________________________________________________________
(Translation of registrant's name into English)
Spirent House, Crawley Business Quarter, Fleming Way, Crawley, West Sussex
RH10 9QL, UK.
_____________________________________________________________________
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F.....
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ..... No X
If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82- ________
Spirent Communications plc
11 December 2006
SPIRENT COMMUNICATIONS PLC
FURTHER CIRCULAR TO SHAREHOLDERS
Why shareholders should vote against the EGM resolutions
London, UK - 11 December 2006 Spirent Communications plc ("Spirent" or the
"Company") (LSE: SPT; NYSE: SPM), a leading technology communications company,
is today posting to its shareholders a circular that reinforces the reasons
provided in the Notice of Requisitioned Extraordinary General Meeting issued on
29 November 2006 why the Board recommends shareholders to vote against all the
resolutions at the forthcoming Extraordinary General Meeting on 22 December 2006
(the "EGM").
The EGM has been requisitioned by three shareholders led by Sherborne Investors
GP, LLC ("Sherborne"). Sherborne is seeking to gain effective control of the
Board of Spirent by replacing three of the Company's non-executive directors,
including the Chairman, with four of its own nominees.
Highlights:
- Spirent has taken the actions to turn around the business already and
has in place a clear strategy to create more value for shareholders
- The current non-executive team is right for Spirent - Sherborne's
proposed directors are wrong for Spirent
- Sherborne's claimed turnaround expertise is not relevant for the next
stage of Spirent's development
- Sherborne's proposal is an attempt to take effective control of the
Board without paying a premium
Board recommendation to vote against the resolutions
The Spirent Board unanimously recommends shareholders to vote against all the
resolutions as it does not believe they are in the best interests of the Company
and shareholders as a whole.
Sherborne is a turnaround investment firm. It has no new strategy for Spirent
and does not have the relevant expertise or experience to justify its taking
control of the Board. Spirent has undergone considerable restructuring in recent
years and is poised to take advantage of this hard work and investment.
Sherborne's claimed turnaround skills are not relevant to the next stage of
Spirent's development. This attempt to take control of the Board would, if
successful, result in considerable disruption to Spirent at a key time.
Transformation and turnaround of Spirent underway
The circular sets out how the current Board has transformed Spirent in recent
years to the position where it now has a clear strategy to create further value
for shareholders. In recent years, key actions have included the sale of
HellermannTyton for GBP298m; significant reductions in the cost base including
manufacturing, outsourcing and removal of a layer of management; new product
developments including the launch of Spirent TestCenter, which has already been
adopted by over 150 customers; and the building of significant positions in new
and growing technologies.
Spirent's clear strategy
The Board has in place a clear strategy to create more value for shareholders.
This includes a margin improvement plan and exploitation of the substantial
investment in Spirent TestCenter; further operating cost reductions of GBP7m on
an annualised basis; termination of the Company's US listing and SEC
registration (which currently costs some GBP3m per year); and an additional
GBP50m share buy back programme.
Indeed Sherborne acknowledges that this is the right strategy for Spirent,
stating in its letter to shareholders of 5 December 2006: "We (Sherborne)
believe it is unlikely that the Company's position will be greatly improved by
new and radical strategic initiatives".
Share price outperformance
Management's actions are beginning to deliver improving performance from
Spirent's core Performance Analysis business. Since the appointment of Spirent's
Chairman, John Weston, was announced in 2002, and over the last 12 months,
Spirent's share price has outperformed its peer group.
Spirent has the right team
The circular points out how the director candidates proposed by Sherborne do not
have the relevant skills or sector expertise to take the Company forward.
Sherborne's proposed directors are experienced in speciality chemicals, visual
information technology and the distribution of promotional products. This should
be contrasted with the current Spirent non-executives who include directors who
have held senior positions at Ericsson, Verizon Communications and Northern
Telecom Ltd and the former chief executives of BAE Systems plc and GKN plc.
Marcus Beresford, Senior Independent Director at Spirent, said:
"Spirent is in a very different situation to those companies that Sherborne has
traditionally bought into, having already taken the actions to turn around the
business. It is already in a strong financial position and is poised to deliver
significant benefits from previously taken and ongoing management actions.
Sherborne is blatantly seeking to take control of the Board without paying a
premium to all shareholders. Its proposals would also mean that the Board would
not comply with important principles of good corporate governance.
The Board unanimously recommends shareholders vote against all the resolutions
as it does not believe they are in the best interests of the Company and
shareholders as a whole."
For further information please contact:
Reg Hoare Smithfield +44 (0)20 7360 4900
Angus Maitland Maitland +44 (0)20 7379 5151
About Spirent Communications plc
Spirent Communications plc is a leading communications technology company
focused on delivering innovative systems and services to meet the needs of cus
tomers worldwide. We are a global provider of performance analysis and service
assurance solutions that enable the development and deployment of
next-generation networking technologies such as broadband services, Internet
telephony, 3G wireless and web applications and security testing. The Systems
group develops power control systems for specialist electrical vehicles in the
mobility and industrial markets. Further information about Spirent
Communications plc can be found at www.spirent.com.
Spirent Communications plc Ordinary shares are traded on the London Stock
Exchange (ticker: SPT) and on the New York Stock Exchange (ticker: SPM; CUSIP
number: 84856M209) in the form of American Depositary Shares ("ADS"),
represented by American Depositary Receipts, with one ADS representing four
Ordinary shares.
Spirent and the Spirent logo are trademarks or registered trademarks of Spirent
Communications plc. All other trademarks or registered trademarks mentioned
herein are held by their respective companies. All rights reserved.
This press release may contain forward-looking statements (as that term is
defined in the United States Private Securities Litigation Reform Act of 1995)
based on current expectations or beliefs, as well as assumptions about future
events. You can sometimes, but not always, identify these statements by the use
of a date in the future or such words as "will", "anticipate", "estimate",
"expect", "project", "intend", "plan", "should", "may", "assume" and other
similar words. By their nature, forward-looking statements are inherently
predictive and speculative and involve risk and uncertainty because they relate
to events and depend on circumstances that will occur in the future. You should
not place undue reliance on these forward-looking statements, which are not a
guarantee of future performance and are subject to factors that could cause our
actual results to differ materially from those expressed or implied by these
statements. The Company undertakes no obligation to update any forward-looking
statements contained in this press release, whether as a result of new
information, future events or otherwise.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
______MICHAEL ANSCOMBE______
(Registrant)
Date: 11 December, 2006 By ____/s/ Michael Anscombe____
(Signature)*