Activist investor Engaged Capital was successful in winning two board seats at video software and interactive guide specialist Rovi, ousting Jim O’Shaughnessy and board chairman Andrew Ludwick, according to preliminary voting info provided by Rovi’s proxy solicitor.
In their place, Rovi stockholders elected Raghavendra Rau, most recently the CEO of SeaChange International, and Glenn Welling, the founder and chief investment officer of Engaged Capital.
Engaged Capital, which has been unhappy with Rovi’s financial performance and strategy, had also originally put forth two other candidates for board seats at Rovi: David Lockwood, now CEO and president of EnergySolutions and a previous director of BigBand Networks (now part of Arris), and Philip A. Vachon, founder and a principal owner of IPMG AG.
Rovi said Wednesday (May 13) that, per the company’s bylaws, Tom Carson, Rovi’s president and CEO, will assume the role of interim chairman of the board.
In addition to Carson, Rovi stockholders also re-elected Alan L. Earhart; N. Steven Lucas; James E. Meyer; and Ruthann Quindlen.
“We thank our stockholders for their efforts and consideration in re-electing five of our directors, and the continued confidence they have expressed in Rovi’s Board and strategy,” Carson said, in a statement. “We also value insights and feedback we have received from our stockholders over the past several weeks. We look forward to welcoming Glenn and Raghu to the Board, once the vote has been certified, and to working with them constructively to build value for Rovi stockholders over the long term.”
In addition to thanking Ludwick and O’Shaughnessy for their service to Rovi, Carson said “Rovi has extremely exciting opportunities ahead, and we look forward to building on our leading IP portfolio and next-generation suite of products to deliver significant growth for years to come.”
Engaged Capital owns 550,000 shares of Rovi common stock.
“Our nominees will contribute fresh, independent, shareholder perspective to the boardroom, and bring extensive experience in developing and implementing strategies that increase shareholder value,” Welling said, in a statement. “Engaged Capital believes that Rovi has the potential to deliver significant value to shareholders. While we would have preferred to avoid a protracted proxy contest, we believe that this process provided shareholders with a forum to express an unequivocal preference for change.”
Before the vote, Rovi had hired Credit Suisse to help it defend against actions being led by Engaged, Reuters reported. Reuters reported in February that Rovi has received interested from private equity firms that have focused on a possible sale of all of Rovi or portions of the company, but said it was not yet clear whether Rovi was open to a sale.
