Icahn Wins Key Endorsement In Proxy Fight With Biogen Idec
Carl Icahn has gotten the support of a key outside voice in his proxy fight with Biogen Idec. The billionaire investor received an endorsement from RiskMetrics Group for two of the four candidates he has nominated to the 13-member board of the Cambridge,MA-based biotech company (NASDAQ: BIIB).
Riskmetrics, formerly known as ISS, recommended shareholders vote for Alex Denner and Richard Mulligan from Icahn’s slate of candidates. It’s potentially an important victory for Icahn, because RiskMetrics is widely considered to be the most influential firm that advises big institutional investors on how to vote in proxy contests or on corporate acquisitions. Last week, Icahn failed to win recommendations from Glass Lewis & Co. and Proxy Governance, the other two significant proxy advisers, so the latest endorsement gives Icahn at least a shot at success in getting a couple seats on the Biogen board, according to this Dow Jones report. (Although if Icahn only wins two seats this year, that still leaves him five seats shy of a majority, so this scenario could be seen as a victory for Biogen as well.)
The proxy battle between Icahn and Biogen has been more intense this year than it was a year ago, as Icahn has issued a withering critique of the company’s “failed leadership.” He got specific, citing the company’s inability to develop any new drugs since 2004, its rising expenses, and stock performance that has trailed its peers. Biogen has shot back that Icahn’s ideas—including one to evaluate splitting the company into two pieces—would “destroy shareholder value.” A split would raise expenses and make it more difficult to develop drugs with multiple uses, the company said.
The votes will be tallied at Biogen’s annual shareholders meeting on June 3.