Politan Managing Partner and Chief Investment Officer Quentin Koffey said his firm is nominating two more candidates for election to the board at this year’s annual meeting in a bid to take control of the board, including the board seat of founder, CEO and Chair Joe Kiani.
“When shareholders overwhelmingly elected Michelle Brennan and me to the Masimo Board last year, we were optimistic we could work productively with the rest of the board to drive positive change,” Koffey said in a news release. “Unfortunately, our efforts were continually rebuffed, as … Kiani refused to give us basic information, denied us access to management, repeatedly held board meetings excluding us, and refused to even consider allowing any review of capital allocation or strategy.”
Kiani is the only Masimo director up for re-election this year as the company declassifies its board over the coming years so that all directors will face annual elections starting in 2026.
Politan’s nominees are former Stryker CFO Bill Jellison and former Agilent Technologies SVP and Chief Technology Officer Darlene Solomon. Politan, which controls about 9% of Irvine, California-based Masimo, encouraged Masimo to accept the nominations and avoid a costly proxy fight.
But today, Masimo said Politan’s efforts to take control of the board and remove Kiani from it “run counter to stockholders’ best interests, as well as those of the hundreds of millions of patients who rely on Masimo’s innovations.”
“While Mr. Koffey continues to suggest he desires an ‘independent’ board, it appears from his continued attacks and misleading claims, including in Politan’s recent press release, that what he really seeks is a Board that agrees with him,” Masimo said in a news release responding to Politan’s latest charges.
“We have serious concerns that Mr. Kiani, without proper oversight, will seek to push through a spin-off with poor corporate governance and IP arrangements where assets are allocated in such a manner designed to maintain his control and influence of both separated companies,” Politan said.
In its response, Masimo said Kiani “is committed to pursuing a separation that would result in two separate companies (consumer and healthcare) having the best chance at future success. The proposed separation would result in a full deconsolidation of the financial statements for the two businesses. The board, including with significant input from Mr. Koffey, is fully involved in evaluating the separation and will ultimately be responsible for approving it.”
Masimo said the board will consider Politan’s nominations before offering its recommendations in Masimo’s annual proxy materials for investors ahead of the 2024 annual meeting.
The exact date and location of Masimo’s 2024 annual meeting is not yet clear. Last year’s meeting was on June 26; the year before, it was held on May 26.
Masimo is the world’s 52nd-largest medical device manufacturer, according to Medical Design & Outsourcing‘s 2023 Medtech Big 100 ranking by revenue.
