Battle Brews Over Masimo Board Elections

A proxy battle is heating up ahead of the company's annual shareholder's meeting later this month.

Citing "poor governance" and a "collapse in valuation," Politan Capital Management, a 9% shareholder of Irvine, CA-based Masimo is trying to get Michelle Brennan and Quentin Koffey elected to the board at the company's June 26 meeting.

Masimo's board recently said it would appoint Brennan as the company's sixth director, but only if shareholders approve a proposal to expand the board to seven and re-elect incumbent directors Michael Cohen and Julie Shimer. Appointing Brennan would also be under the condition that Koffey, managing partner and chief investment officer at Politan, is not elected.

“Unlike Politan’s other nominee, Quentin Koffey, who has a history of misstatement and distortion and no relevant experience, Ms. Brennan has operational and leadership experience in the medical devices industry at Johnson & Johnson, prior public company board service at Cardinal Health and Coupa Software,” said Shimer, chair of the board’s nominating committee. “Though Politan has not permitted us to interview Ms. Brennan after repeated requests, we conducted independent due diligence on her past leadership and board service experiences and feel she would bring a constructive and relevant perspective to the board. As this action shows, the board is open to experienced insight and diverse perspectives and will continue to seek out similarly qualified and independent candidates for the seventh board seat.”

Politan balked at Masimo's offer.

“Meaningful change is clearly needed on Masimo’s board," Koffey said. "For years, Masimo has gone to extreme and well-documented lengths to avoid this occurring. Making Michelle’s appointment contingent on all incumbent directors being elected is not progress – it is yet another defensive maneuver to impede shareholder-driven change."

Politan has posted its presentation, proxy materials, and letter to shareholders on its campaign site. The company's proxy materials are posted on Masimo's campaign site.

"Michelle wants to be able to bring the type of positive, substantive improvement to the company that has been outlined in Politan’s campaign and will only be possible with a real level of change," Koffey said. "If elected, Michelle and I will be fully committed from day one to working constructively alongside the other directors to further the best interests of the Company. While we unfortunately expect the emotive attacks from Masimo to continue leading up to the vote, we encourage shareholders to look past these unproductive distractions. We believe the facts and analysis we have presented – all of which are carefully supported – speak for themselves."