Both Leading Proxy Advisory Firms – ISS and
Glass Lewis – Have Now Strongly Validated Politan’s Case for Change
and Recommended Shareholders Vote for Darlene Solomon and William
Jellison in Order To Provide Urgently Needed Independent Oversight
on Masimo’s Board
ISS Highlights the “Dangerous Lack of
Accountability” on the Current Board and Notes That Mr. Kiani Has
“No Regard for Public Shareholders”
Concludes That Shareholders Have “No Reason to
Believe Management Can Be Trusted” to Structure the “Pivotal”
Separation of the Consumer Business, and That Change Is “Absolutely
Necessary” To Ensure the Separation Does Not Harm Shareholder
Value
Dismisses Masimo’s “Defensive Rhetoric That
Reflects a Disregard for Shareholders” and Notes That the Company’s
Arguments “Crumble Under Basic Scrutiny”
Politan Capital Management (together with its affiliates,
“Politan”), an 8.9% shareholder of Masimo Corporation (“Masimo” or
the “Company”) (NASDAQ: MASI), today announced that leading
independent proxy advisory firm Institutional Shareholder Services
Inc. (“ISS”) has recommended shareholders vote FOR the election of
Politan’s nominees, Darlene Solomon and Bill Jellison, to the
Company’s Board of Directors (the “Board”) at the Annual Meeting of
Stockholders (the “Annual Meeting”), scheduled for July 25,
2024.
ISS’s report affirms Politan’s case for change at Masimo and
advises shareholders to vote for BOTH Politan nominees,
stating:1
- “In addition to ongoing concerns with accountability,
management is now overseeing a separation of the consumer business.
Given management's history of disregard for the investor base, and
developments over the past year, shareholders
have no reason to believe that management can be trusted to
structure a pivotal transaction on their behalf without the
safeguard of further board independence. Thus, change is not
only warranted on the basis of fundamental corporate governance
failings, but is absolutely necessary to
ensure that the separation does not compromise shareholder
value.”
- “Instead of using last year's proxy contest as a chance to
break with the past, the board has continued to bow to Kiani,
including by allowing him to exercise inappropriate influence over the refreshment
process. Thus, MASI has continued to display a dangerous lack of accountability to shareholders
that will require additional board change to rectify.”
- “Moreover, like last year, Kiani and his
cohort have adopted defensive rhetoric that reflects disregard for
shareholders. In summary, they have continued their
established pattern of presenting arguments that they apparently
think will resonate with the investor base, but that crumble under basic scrutiny. This is just further
evidence that the board is not currently configured to promote
accountability to shareholders.”
ISS criticizes Masimo’s underperformance for shareholders,
stating:
- “The board's various arguments were generally unsupported by the facts, and were disingenuous or
clearly false in certain cases.”
- “The 2023 AGM was not the reset that shareholders had hoped
for, as performance has only continued to deteriorate over the past
year. It appears that the majority of this underperformance is due
to operational issues that originated under
the watch of the legacy board early last year.”
- “…[S]hareholders should recognize that MASI has been chasing a
30 percent operating margin since at least FY2017, and has not broken 25 percent over a single fiscal year since
then.”
ISS also details the Board’s broken corporate governance and
concerns with Mr. Kiani’s outsized influence in the boardroom,
stating:
- “…Kiani insisted on inserting himself into the board
refreshment process over the past year, referring both Chapek and
Chavez. To put it bluntly, there is no
acceptable justification for Kiani to participate in this
manner, considering the role he played in constructing the
legacy board, which prioritized his interests
at the expense of shareholders.”
- “…Kiani has demonstrated that he has no regard for public
shareholders. He has been at the center of so
many corporate governance scandals and abuses that
no credible argument exists to the
contrary.”
- “Under no circumstances should
shareholders ever abide ultimatums or threats from a CEO, at MASI
or anywhere else. If Kiani wants to leave, he can do so.
Although it appears that MASI has done little in the way of
succession planning (which is just another sign of Kiani's
control), the dissident has identified Brennan as an interim
option. Based on her background, experience, and familiarity with
MASI, there is no reason to believe that she could not be effective
in an interim capacity.”
- “There was no convincing evidence that
the board exercised genuine oversight of management, and by
extension, there was not a shred of
observable accountability to shareholders.”
ISS highlights the experience Politan’s nominees will bring to
the boardroom, stating:
- “Bill Jellison and Darlene Solomon have relevant executive backgrounds and have served on public
company boards, and together they have experience with M&A and
business separations that could be beneficial as MASI evaluates
alternatives for the consumer business. Moreover, the
criticisms presented by MASI about their qualifications overlook
the most important point, which is that they are they are
unquestionably independent from
Kiani.”
Quentin Koffey, Managing Partner and Chief Investment Officer of
Politan, stated:
“The recommendation from ISS for both our nominees Darlene and
Bill – following the same conclusion from Glass Lewis last week –
validates our case that a majority of truly independent directors
are urgently needed in Masimo’s boardroom today. Further, the
report from ISS again demonstrates that the excuses and attacks
released by the Company on a nearly daily basis are false,
disingenuous and merely attempt to distract shareholders from the
facts. In contrast, we are confident that if elected, Darlene and
Bill would work collaboratively in the boardroom to protect
shareholder value and help ensure the Company moves forward so that
it is best positioned for the future."
Politan encourages shareholders to review its presentation,
proxy materials and letter to shareholders, all of which are
available at www.AdvanceMasimo.com. Shareholders can support real
change at Masimo by voting on the WHITE proxy card FOR the election
of Darlene Solomon and William Jellison.
Your vote is important, no matter how many
shares of Common Stock you own. We urge you to sign, date, and
return the WHITE universal proxy card today to vote FOR the
election of the Politan Nominees and in accordance with the Politan
Parties’ recommendations on the other proposals on the agenda for
the 2024 Annual Meeting.
If you have any questions, require assistance
in voting your WHITE universal proxy card or voting
instruction form, or need additional copies of Politan’s proxy
materials, please contact D.F. King using the contact information
provided here:
D.F. King & Co., Inc. 48 Wall
Street New York, New York 10005 Stockholders call
toll-free: (888) 628-8208 Banks and Brokers call: (212)
269-5550 By Email: MASI@dfking.com
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
The information herein contains “forward-looking statements.”
Specific forward-looking statements can be identified by the fact
that they do not relate strictly to historical or current facts and
include, without limitation, words such as “may,” “will,”
“expects,” “believes,” “anticipates,” “plans,” “estimates,”
“projects,” “potential,” “targets,” “forecasts,” “seeks,” “could,”
“should” or the negative of such terms or other variations on such
terms or comparable terminology. Similarly, statements that
describe our objectives, plans or goals are forward-looking.
Forward-looking statements are subject to various risks and
uncertainties and assumptions. There can be no assurance that any
idea or assumption herein is, or will be proven, correct. If one or
more of the risks or uncertainties materialize, or if any of the
underlying assumptions of Politan Capital Management LP (“Politan”)
or any of the other participants in the proxy solicitation
described herein prove to be incorrect, the actual results may vary
materially from outcomes indicated by these statements.
Accordingly, forward-looking statements should not be regarded as a
representation by Politan that the future plans, estimates or
expectations contemplated will ever be achieved.
Certain statements and information included herein may have been
sourced from third parties. Politan does not make any
representations regarding the accuracy, completeness or timeliness
of such third party statements or information. Except as may be
expressly set forth herein, permission to cite such statements or
information has neither been sought nor obtained from such third
parties. Any such statements or information should not be viewed as
an indication of support from such third parties for the views
expressed herein.
Politan disclaims any obligation to update the information
herein or to disclose the results of any revisions that may be made
to any projected results or forward-looking statements herein to
reflect events or circumstances after the date of such information,
projected results or statements or to reflect the occurrence of
anticipated or unanticipated events.
CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
Politan and the other Participants (as defined below) have filed
a definitive proxy statement and accompanying WHITE universal proxy
card or voting instruction form with the Securities and Exchange
Commission (the “SEC”) to be used to solicit proxies for, among
other matters, the election of its slate of director nominees at
the 2024 annual stockholders meeting (the “2024 Annual Meeting”) of
Masimo Corporation, a Delaware corporation (“Masimo”). Shortly
after filing its definitive proxy statement with the SEC, Politan
furnished the definitive proxy statement and accompanying WHITE
universal proxy card or voting instruction form to some or all of
the stockholders entitled to vote at the 2024 Annual Meeting.
The participants in the proxy solicitation are Politan, Politan
Capital Management GP LLC (“Politan Management”), Politan Capital
Partners GP LLC (“Politan GP”), Politan Capital NY LLC (the “Record
Stockholder”), Politan Intermediate Ltd., Politan Capital Partners
Master Fund LP (“Politan Master Fund”), Politan Capital Partners LP
(“Politan LP”), Politan Capital Offshore Partners LP (“Politan
Offshore” and, collectively with Politan Master Fund and Politan
LP, the “Politan Funds”), Quentin Koffey, Matthew Hall, Aaron
Kapito (all of the foregoing persons, collectively, the “Politan
Parties”), William Jellison and Darlene Solomon (such individuals,
collectively with the Politan Parties, the “Participants”).
As of the date hereof, the Politan Parties in this solicitation
collectively own an aggregate of 4,713,518 shares (the “Politan
Group Shares”) of common stock, par value $0.001 per share, of
Masimo (the “Common Stock”). Mr. Koffey may be deemed to own an
aggregate of 4,714,746 shares of Common Stock (the “Koffey
Shares”), which consists of 1,228 restricted stock units (the
“RSUs”) as well as the Politan Group Shares. Politan, as the
investment adviser to the Politan Funds, may be deemed to have the
shared power to vote or direct the vote of (and the shared power to
dispose or direct the disposition of) the Politan Group Shares,
and, therefore, Politan may be deemed to be the beneficial owner of
all of the Politan Group Shares. The Record Stockholder is the
direct and record owner of 1,000 shares of Common Stock that
comprise part of the Politan Group Shares. Both the Politan Group
Shares and the Koffey Shares represent approximately 8.9% of the
outstanding shares of Common Stock based on 53,182,247 shares of
Common Stock outstanding as of June 13, 2024, as reported in
Masimo’s definitive proxy statement filed on June 17, 2024. As the
general partner of Politan, Politan Management may be deemed to
have the shared power to vote or direct the vote of (and the shared
power to dispose or direct the disposition of) all of the Politan
Group Shares and, therefore, Politan Management may be deemed to be
the beneficial owner of all of the Politan Group Shares. As the
general partner of the Politan Funds, Politan GP may be deemed to
have the shared power to vote or to direct the vote of (and the
shared power to dispose or direct the disposition of) all of the
Politan Group Shares, and therefore Politan GP may be deemed to be
the beneficial owner of all of the Politan Group Shares. Mr.
Koffey, including by virtue of his position as the Managing Partner
and Chief Investment Officer of Politan and as the Managing Member
of Politan Management and Politan GP, may be deemed to have the
shared power to vote or direct the vote of (and the shared power to
dispose or direct the disposition of) all of the Koffey Shares.
IMPORTANT INFORMATION AND WHERE TO FIND IT
POLITAN STRONGLY ADVISES ALL STOCKHOLDERS OF MASIMO TO READ ITS
DEFINITIVE PROXY STATEMENT, ANY AMENDMENTS OR SUPPLEMENTS TO SUCH
PROXY STATEMENT AND OTHER PROXY MATERIALS FILED BY POLITAN WITH THE
SEC AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON
THE SEC’S WEBSITE AT WWW.SEC.GOV. THE DEFINITIVE PROXY STATEMENT
AND OTHER RELEVANT DOCUMENTS ARE ALSO AVAILABLE ON THE SEC WEBSITE,
FREE OF CHARGE, OR BY DIRECTING A REQUEST TO THE PARTICIPANTS’
PROXY SOLICITOR, D.F. KING & CO., INC., 48 WALL STREET, 22ND
FLOOR, NEW YORK, NEW YORK 10005 STOCKHOLDERS CAN CALL TOLL-FREE:
(888) 628-8208.
1 Permission to quote ISS was neither sought nor obtained.
Underlining added.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240715170838/en/
Investor Contact D.F. King & Co., Inc. Edward
McCarthy / Gordon Algernon / Dan Decea MASI@dfking.com
Media Contacts Dan Zacchei / Joe Germani Longacre Square
Partners dzacchei@longacresquare.com /
jgermani@longacresquare.com
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