Activist Investors Win Three Seats On Imation Board
Activist investors targeting Oakdale-based Imation Corp. succeeded in getting a slate of three new members elected to the company’s board of directors. The New York-based Clinton Group has been calling for new leadership for the struggling data storage and security company.
Imation issued a statement late Wednesday indicating that based on the “preliminary vote count provided by its proxy solicitor,” the company’s shareholders voted to elect the Clinton Group’s nominees to the board: Joseph De Perio, Robert Fernander and Barry Kasoff. The company’s annual meeting was held on Wednesday in Lake Elmo.
The vote means that Imation’s CEO Mark Lucas and chairman L. White Matthews III are both off the six-member board, as is David Stevens.
In an email late Wednesday to Twin Cities Business, De Perio commented: “We are gratified to report strong shareholder support for all of our nominees. While the results are still being certified, we had a pleasant meeting with the continuing directors today and expect to collaborate going forward.”
Newly elected board member De Perio is senior portfolio manager for the Clinton Group.
In the immediate wake of the vote, the next steps for the company are not clear. In its tendentious filings, the Clinton Group has strongly criticized Imation’s current management, its low stock price and ongoing losses at the company.
“We thank all of our shareholders for their participation throughout this process. We look forward to working collaboratively with our new and existing directors to maximize shareholder value for all shareholders, including completing the fulsome review of strategic alternatives,” said Imation CEO Lucas in the company’s statement.
Imation, which was spun off from Maplewood-based 3M Company in 1996, has faced dwindling revenue and large losses for years. For 2014, Imation posted a net loss of $114.7 million on revenue of $729.5 million. Imation’s revenue has dropped steadily since 2008, when it was nearly $2 billion.
Earlier this month, Imation reported a net loss of $14.4 million on revenue of $155.4 million for the first quarter. The company’s sales reflected a 13.1 percent drop compared to the first quarter of 2014.
Imation is the second Minnesota public company to be targeted by the Clinton Group.
Last year the Clinton Group succeeded in electing a slate of directors for Eden Prairie-based ValueVision Media Inc., the nation’s third-place home shopping channel. Now known as EVINE Live Inc., the company is trying to overhaul its business under new CEO Mark Bozek, who is leading a push for the company to focus on proprietary product offerings.