A bitter war for control of ConMed (NSDQ:CNMD) is heating up as the medical device company’s annual meeting looms, with a hedge fund pressing hard to win shareholders’ votes for its board nominees.
Utica, N.Y.-based ConMed’s shareholders meeting is slated for Sept. 10. As the date approaches, ConMed is vying with Voce Capital Management over their respective board nominees. The battle over ConMed dates back to at least last November, when Voce demanded that the company take steps toward a strategic exit and end "a culture of nepotism, patronage and dystopian corporate governance."
Voce, which owned less than 1% of ConMed at the time, targeted the family of founder, former CEO and then-chairman Eugene Corasanti in the Nov. 4 letter. Corasanti’s son, Joseph Corasanti, has been CEO since 2006. Voce and ConMed traded barbs for the rest of 2013 and into the new year, until a surprise announcement last February revealed ConMed’s alliance with Coppersmith.
That deal also saw the elder Corasanti step down as chairman, replaced by independent director Mark Tryniski, and added Coppersmith Capital Management managing partner Jerome Lande and former Stryker (NYSE:SYK) CFO and interim CEO Curt Hartman to the board. ConMed later named Hartman as its own interim CEO, but not before Voce aired ugly accusations gleaned from the proxy war for control of Alere (ALR). In March ConMed delayed its annual meeting, originally scheduled for late May, to examine a potential sale.
Then, last April, CNMD shares surged on rumors that it was seeking a buyout. Last month ConMed said it had decided against a sale and planned to focus on operational improvements. Earlier this month Voce rebuffed a ConMed offer that would have admitted to the board a Voce nominee, Accuray (NSDQ:ARAY) president & CEO Joshua Levine.
"Voce rejected the company’s offer and insisted that J. Daniel Plants, Voce’s managing partner, also be included as one of the company’s director nominees as part of any settlement agreement," according to a press release.
ConMed then nominated its own slate for reelection: Hartman, Lande and Tryniski, plus Haemonetics (NYSE:HAE) CEO Brian Concannon, Dirk Kuyper, Charles Farkas, Jo Ann Golden and Stephen Mandia.
"Voce Capital Management LLC, which owns less than 0.5% of the company’s outstanding common stock, has ignored the important changes we have made and is pursuing a potentially expensive and disruptive proxy contest to replace 3 members of your board with its own nominees. We believe this decision indicates that Voce’s interests may not be aligned with those of other shareholders," the company said in a letter to shareholders.
Voce wants shareholders to vote to replace Lande, Golden and Mandia with its candidates: Plants, Analogic (NSDQ:ALOG) CEO James Green and Accuray (NSDQ:ARAY) CEO Joshua Levine.
"[W]e do not believe that the current board of directors of the company … is acting in the best interests of the company’s shareholders," Voce said in a regulatory filing. "We are seeking to change a minority of the board to ensure that the interests of the shareholders are appropriately represented in the boardroom."
Clarification: This article was updated August 15, 2014, to clarify the roles of Voce Capital Management, Coppersmith Capital Management and ConMed, and to clarify the reason for the delay in ConMed’s annual meeting.
The post Activist investor battles on over ConMed as shareholders vote approaches appeared first on MassDevice.