Strongbow Capital lacks confidence in Duckwall-Alco's board

By Lisa Kerner

Charlotte, N.C., Nov. 20 - Strongbow Capital, Ltd. chairman Raymond A.D. French expressed dissatisfaction with the results to date of Duckwall-Alco Stores, Inc.'s three-year turn around program.

French made his comments in a Nov. 20 letter to Duckwall's board. The letter was included as part of a schedule 13D filing with the Securities and Exchange Commission.

Strongbow owns 543,517 shares, or 14.27% of Duckwall, making it the company's largest shareholder, the letter stated.

French said his "patience is being severely tested" after Duckwall's board failed to take steps suggested by French in a prior SEC filing.

The investor supports the addition of Royce Winstein to Duckwall's board. However, French is "not pleased with the company's apparent unwillingness to create an executive committee with specific responsibility" for addressing what French sees as three problem areas

• SG&A expense control;

• Inventory reductions; and

• Shrinkage.

French doubted the company would see dramatic improvements in its financial performance under the current board of directors. In addition, French added that "it is our strongly held opinion that substantial change will be needed at the board level if the company's patient shareholders are to see the financial performance and stock value they deserve."

Duckwall is an Abilene, Kan.-based discount retailer.

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