Illumina CEO survived Icahn's challenge by more than 2-to-1 margin

Linear Minerals

30/05/2023 23:35

By Svea Herbst-Bayliss
       NEW YORK, May 30 (Reuters) - Illumina Inc  ILMN.O  CEO
Francis deSouza survived a challenge to his board seat from
activist investor Carl Icahn last week by securing more than
twice the shareholder votes than the number his challenger
received, the company said in a filing on Tuesday. 
    While the outcome of the vote was known, the tally had not
been previously disclosed. It gives deSouza legitimacy to carry
on after Icahn mustered enough shareholder support to oust
Illumina's board chair John Thompson and install one of his
board nominees, Andrew Teno. 
    Icahn tried to replace both deSouza and Thompson on the
board and said he wants former Illumina CEO Jay Flatley to
return to run the company. The company's share price lost 18.4%
in the last 52 weeks.
    A year ago deSouza was the company's top vote getter with
130,098,117 votes cast for him. This year he received 93,110,014
votes, beating out only Thompson and two of Icahn's nominees.
    Teno received 77,769,509 votes while Thompson received
45,091,516 votes. The two other Icahn nominees received the
fewest votes.
    Icahn criticized Illumina, including deSouza and Thompson,
for its $7.1 billion acquisition of cancer test maker Grail.
Illumina completed the deal over the objections of U.S. and
European antitrust regulators, who are now trying to force the
company to unwind it.
    Illumina lost $50 billion in market value following the deal
as investors fret it may be forced to divest Grail at a big
loss.
    Illumina has said it will expand its board from nine members
to 11 and has interviewed chiefs of publicly traded companies
with healthcare experience and chief financial officers of
publicly traded companies with Wall Street experience to join.
It will also elect a new board chair.
    Activist investors are increasingly calling for top
executives to be replaced, with Insightia data showing they
pushed for the removal of personnel at 60 companies last year, a
46% jump from the year before and the highest amount since 2017.
    Some CEOs who had activists join their board did not stay in
the position for long. Unilever Plc CEO Alan Jope, for example,
announced plans to leave three months after hedge fund Trian
Fund Management's Nelson Peltz joined the consumer giant's board
last year. Brian Niccol took the reins at Chipotle Mexican Grill
in early 2018 after one of Bill Ackman's lieutenants at Pershing
Square Capital Management joined the board in late 2016.
    Other CEOs have survived. Vicki Hollub remains Occidental
Petroleum's  OXY.N  CEO after the company cut a deal with Icahn
over board seats in 2020 and after Icahn cashed out two years
later. 

 (Reporting by Svea Herbst-Bayliss; Editing by David Gregorio)
 ((svea.herbst@thomsonreuters.com; +617 856 4331; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))