Investor
seeks shake-up at Nabi
A large investor in Boca Raton-based Nabi Biopharmaceuticals
said Tuesday it will move to oust the company's chairman
and chief executive officer, Thomas McLain, from the board
of directors for financial mismanagement.
The fund said it also might seek to remove one or more
other board members. Nabi spokesman Thomas Rathjen said
the company had no comment.
In seeking McLain's ouster, Third Point LLC, a New York
hedge fund, plans to use a strategy permitted under Delaware
law in which a majority vote by shareholders can remove
board members. Nabi is incorporated in Delaware.
Nabi's bylaws require a 75 percent vote by shareholders
to remove a board member, but Third Point contends that
company rule is not valid because Delaware's law takes
precedence.
Third Point, headed by Daniel Loeb, owns 9.5 percent
or 5.75 million of Nabi's outstanding shares, and combined
with other institutional shareholders might hold majority
ownership of the company. But that's unclear because owners
of less than 5 percent of Nabi stock don't have to publicly
declare their ownership. Nabi shares closed Tuesday at
$5.65, down 4 cents.
Loeb has sharply criticized Nabi for using cash reserves
too quickly and for an inability to gain approval for
key drugs. He also has urged the board to explore alternatives
to boost the stock price, including a sale of the whole
company to one buyer or parts of the company to several
buyers.
"You can ignore the will of the shareholders for
only so long," said Jason Aryeh, general partner
of Greenwich, Conn.-based JALAA Equities LP, which owns
about 2.5 percent of Nabi's shares. "It is the responsibility
of the directors to carry out the wishes of the majority
of the shareholders."
He added: "No matter who gets thrown off, it will
send a resounding message to the board that a majority
of stockholders don't approve of the direction of the
company."
Third Point "also intends to solicit consents in
favor of a proposal requesting that one or more individuals
named by Third Point be added to the Board to fill any
vacancies created by the removal of directors," according
to a proxy statement filed Tuesday with the Securities
and Exchange Commission.
