Illumina on Thursday urged shareholders to reject Carl Icahn’s three board nominees at this year’s annual meeting, saying they would “threaten the progress” of the biotech company’s core business.
“Carl Icahn’s involvement with Illumina risks the long-term success of the Company, and his director nominees bring no relevant skills to the Board of Directors,” San Diego-based Illumina said in a preliminary proxy statement filed Thursday.
The DNA sequencing company told shareholders to discard and not vote using any proxy card sent by the activist investor or his affiliate entities. Illumina also urged shareholders to vote in favor of its proposed board of directors, noting that it would mail its definitive proxy materials soon. The company has not announced the date of its annual shareholder meeting.
Illumina said it will provide more information about “the strength of our Board and management team, our strategy to deliver shareholder value – with innovation at its core – and the potential for Mr. Icahn’s associate nominees to damage that strategy.”
Icahn did not immediately respond to a request for comment.
Illumina’s remarks are its latest move in a brewing proxy fight with Icahn, who owns a 1.4% stake in the company. Icahn is pushing Illumina to unwind its $7.1 billion acquisition of cancer test developer Grail, which he previously said represents “a new low in corporate governance.” On Wednesday, he said Illumina should bring back its former CEO Jay Flatley immediately to “fix the situation.”
Illumina on Thursday said Icahn isn’t a long-term shareholder and did not engage with the company before demanding board representation. The company noted it “moved quickly and deliberately” to meet with Icahn, interview his nominees in good faith and explore potential alternatives to a proxy fight.
But Icahn was “unwilling to compromise” and insisted that the board add his three nominees without input from shareholders, Illumina said. The company also alleged that Icahn said he wanted his nominees on the board because he controls them and they aren’t independent.
“My guys answer to me,” Icahn said about his nominees, according to Illumina.
The company said Icahn’s choices had no relevant health care or genomics expertise on paper. After interviewing the nominees, Illumina determined that they also lacked any “original perspective or detail” on how they would like to see the company operate differently.
“Each candidate instead recited the same poorly researched and non-actionable ideas with respect to GRAIL,” Illumina said.
The company added that “it has become abundantly clear that neither Mr. Icahn, nor his three associate nominees — Jesse Lynn, Andrew Teno, or Vincent Intrieri — understand Illumina’s business or GRAIL and the associated regulatory processes.”
Vincent Intrieri, the founder and CEO of VDA Capital Management, was previously employed by Icahn. Jesse Lynn is the general counsel of Icahn Enterprises and Andrew Teno is a portfolio manager at Icahn Capital LP, an entity where Icahn manages investment funds.
Illumina shares were relatively flat following its announcement. The company’s market cap has shrunk to around $35 billion from about $75 billion in August 2021, the month it closed the Grail deal.
Icahn has previously claimed that the acquisition wiped out tens of billions of dollars in Illumina’s market value and “clearly shows that shareholders have lost faith in Illumina’s management team and board of directors.”