Sunday, June 22, 2008

Icahn's Slate Loses at BIIB

I reported in April that Carl Icahn was making waves at a company called Biogen Idec.

Now we can report that Icahn put forward a three-nominee slate in a contested election for four open board seats at the annual meeting held last week.

It isn't clear what the margin of defeat was. But it is now clear that all the Icahn-backed candidates were defeated.

The management candidates received an important assist from each of the major proxy advisory services. ISS Governance Services, part of RiskMetrics Group, said in its report that "the dissident has not met its burden of proving that board change is warranted at Idec. Absent a showing that the incumbent board has failed in some fashion, we find it difficult to support the removal of directors."

Said Glass Lewis: "Shareholders should support management's nominees. In our opinion the current board and executives have created substantial value for shareholders and we believe that the Company has solid growth opportunities as a stand-alone entity."

And to make it unanimous, Proxy Governance weighed in thus: "Given the track record of this board and its management team over the five years since Biogen and Idec merged, as well as significant performance targets to which the company has committed itself through 2010, we believe shareholders will be better served by re-electing the management slate of nominees."

The thing about Icahn is -- he keeps up with these things, and over time can simply wear opposition down. He may have something more to say about BIIB going forward, or he may sell his shares and move on to something else.

He might, for example, (I'm just guessing!) want to liquidate his position in BIIB in order to buy more shares of Yahoo, where his nuisance value is only beginning to manifest itself.

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