Billionaire financier Carl Icahn, reacted to Motorola’s decision to split the company into two independent entities, by calling the move a “step into the right direction”, but he has “concerns” about the “speed and manner” in which a new management team is selected for the Mobile Devices business.
Icahn specifically criticized that Motorola expects that it will take until 2009 until the separation will be completed and that Motorola accepts the risk of a proxy fight before the company makes promises he wants “to hear”.
Icahn, who holds about 2.9% of Motorola’s shares, sharply attacked Motorola’s board of directors about the fact how the proxy fight issue was handled in an open letter:
“You stated during today’s conference call, “we discussed Board Nominees with Carl Icahn and we proposed two nominees and he declined.” Again this is only partially true. It is true that Sandy Warner, head of the Nominating Committee called me and offered seats to two of my Nominees if I would drop the proxy fight. However, you failed to mention in your conference call that I told Mr. Warner that I would gladly accept this offer if the Board would also accept Keith Meister. Mr. Warner replied
summarily to this offer that Meister did not “qualify.” I asked Mr. Warner what does one have to do to qualify — lose $37 billion dollars? Mr. Warner then replied that the Board did not “know” Meister. My answer was that Meister would fly anywhere at any time to meet the Board so they could “know” him (I did mention that the situation at Motorola is too serious for the Board to remain a country club). My offer to Motorola still stands.”
“ You have stated to the press that our request for information about what steps the Board actually took to correct the problem at Motorola is an unnecessary distraction. We disagree. In a political election when constituents believe their representatives’ performance was inadequate, they are certainly not denied information as to whether their representative acted in a grossly negligent fashion. Why should it be different in Corporate America?”
“I do however agree with you that this proxy fight is a distraction that Motorola at this junction can ill afford. If as you have stated, we all want to benefit the stockholders of Motorola, then what possible reason is there for not putting Keith Meister on the Board. After all, how much can he eat at the Board meetings? On a positive side, having a highly intelligent, energetic individual like Keith, who has 145 million reasons to spend his time working toward the spin-off being accomplished, may well make this promise come true in a timely fashion.”
“We ask the Board meet with Meister, put egos aside and let’s get on with the urgent business at hand.”