UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
Westell Technologies Inc.
(Name of Issuer)
Common Stock Class A, $.01 par value
(Title of Class of Securities)
957541105
(CUSIP Number)
Daniele Beasley
Cove Street Capital LLC
2101 E. El Segundo Boulevard, Suite 302
El Segundo, CA 90245
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 23, 2016
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. x
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
| CUSIP No. 957541105 | 13D | Page 2 of 3 Pages | ||
| 1. | NAMES OF REPORTING PERSONS I.R.S.
IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Cove Street Capital, LLC I.R.S. IDENTIFICATION NO 27-5376591 |
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| 2. | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (see instructions) (a) ¨ (b) ¨ |
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| 3. | SEC USE ONLY |
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| 4. | SOURCE OF FUNDS (see instructions) OO |
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| 5. | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) ¨ | |||
| 6. | CITIZENSHIP OR PLACE OF ORGANIZATION Delaware |
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7. |
SOLE VOTING POWER
| ||
| 8. | SHARED VOTING POWER 1,122,953 | |||
| 9. | SOLE DISPOSITIVE POWER 6,596,763 | |||
| 10. | SHARED DISPOSITIVE POWER 1,122,953 |
| 11. | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,719,716 |
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| 12. | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
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| 13. | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.3% |
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| 14. | TYPE OF REPORTING PERSON (see instructions)
IA |
| CUSIP No. 957541105 | 13D | Page 2 of 3 Pages | ||
Item 1. Security and Issuer.
This statement related to the common stock class A, $.01 par value per share (the “Shares”), of Westell Technologies, Inc (the “Issuer”). The address of the principal executive offices of the Issuer is 750 North Commons Drive, Aurora, IL 60504.
Item 2. Identity and Background.
a) This statement on Schedule 13D is being filed pursuant to Rule 13d-1 under the Securities Exchange Act of 1934, as amended, by Cove Street Capital, LLC (CSC).
b) The address of the principal office of CSC is: 2101 East El Segundo Boulevard, Suite 302, El Segundo, CA 90245
c) The principal business of CSC is as an Investment Adviser.
d) CSC, nor any of its members has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).
e) CSC, nor any of its members was, during the last five years, a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, was or is subject to a judgment, decree or final order (1) enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws, or (2) finding any violation with respect to such laws.
f) CSC is a Delaware limited liability company.
Item 3. Source or Amount of Funds or Other Consideration.
CSC in its capacity as an Investment Adviser will purchase on behalf of its clients. No monies are borrowed for such an acquisition. The aggregate purchase price of the 7,719,716 shares beneficially owned by CSC is approximately $15,664,964 including brokerage commissions.
Item 4. Purpose of Transaction.
Item 4 of the Schedule 13D is hereby amended and supplemented by the addition of the following:
Attached hereto as Exhibit 1 to this Amendment No. 1 of Schedule 13D is a letter sent to Shareholders and Board of Directors of the Issuer on August 11, 2016.
Item 5. Interest in Securities of the Issuer.
a) & b) CSC has sole discretionary investment and voting power on 6,596,763 shares and shared on 1,122,953 shares of Common Stock which constitutes approximately 16.3% of 47,313,712 the shares outstanding of common stock class A.
c) CSC has effected no transactions, on behalf of its clients, in the following shares of Common Stock in the last 60 days.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
Except as otherwise described in this Schedule 13D, there are no contracts, arrangements, understandings, or relationships (legal or otherwise) among CSC, or between any third party, with respect to any securities of the Issuer.
Item 7. Material to Be Filed as Exhibits.
Attached hereto as Exhibit 1 is a press release on August 23, 2016.
| CUSIP No. 957541105 | 13D | Page 3 of 3 Pages | ||
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| COMPANY NAME |
/s/ Daniele Beasley Daniele Beasley |
Chief Compliance Officer, Member |
August 23, 2016 |
Cove Street Capital, LLC Announces
Plan
to Vote Against the Board of Directors of Westell Technologies, Inc
After Repeated Rejection of Request for Discourse
EL SEGUNDO, CA, August 23, 2016 — As a follow up to an August 10, 13D filing with the SEC, and a letter to the Board of Directors of Westell Technologies, Inc (Nasdaq: WSTL) (“Westell” or the “Company”), Cove Street Capital, LLC (“Cove Street”) announces their intention to vote against the Board of Directors of Westell. Cove Street’s attempts to establish a constructive dialog with Westell have been rejected, most recently in the form of a letter from CEO Tom Gruenwald—the public face of the company who is unfortunately tasked with answering for the Company’s past mistakes—professing that Cove Street’s suggestions are being “considered” by the Board.
“We believe that the stock’s performance over the last 15 years and the current share price speak for themselves,” states Cove Street Principal and Portfolio Manager, Jeffrey Bronchick, CFA. “As such, it is not clear to us what is left for the Board to consider.”
Cove Street presently owns 16.3% of the common stock class A shares outstanding, making it the second largest shareholder after the Penny Family Trust. Cove Street’s research suggests the following:
| · | The last five years of operating results clearly indicate that the Company does not have enough scale to consistently operate profitably, produce positive free cash flow, or generate returns above its cost of capital. |
| · | The lack of scale combined with end market cyclicality and customer concentration—the top 2 customers accounted for 34.2% of revenue in FY 2016—create considerable risk of further negative free cash flow and shareholder value destruction. |
| · | Given the current share price, unless the Board acts quickly, the Company is at risk of being delisted from the NASDAQ. |
| · | There are numerous buyers for the Company’s assets and waiting to sell after more cash has been burned will likely only diminish the Company’s bargaining position. |
| · | The current Board has shown no ability to facilitate a turnaround of the Company’s fortunes, despite having brought in a number of CEOs and supported numerous failed growth initiatives. |
Mr. Bronchick continues, “We fully understand that as A-class shareholders we can be outvoted by the Penny Family’s B-class shares. Despite that, shareholders still have the opportunity to voice their displeasure for the current state of affairs at the upcoming annual meeting. To borrow an apt quote from Carl Icahn, ‘A lot of people died fighting tyranny. The least I can do is vote against it.’ ”
Important Information:
Cove Street Capital, LLC, a Delaware Limited Liability Company, is a California based, SEC registered investment advisor that commenced operations in 2011.