Navistar International Corp. announced Samuel J. Merksamer, managing director at Icahn Capital LP, has been appointed to the company’s board. According to a news release, he replaces Diane Gulyas, who retired after serving three years as a board member.
Merksamer’s appointment to the board and Gulyas’s retirement are effective Dec. 10, maintaining the total number of Navistar board members at 10, nine of whom are independent.
The appointment of Merksamer represents the third board member appointment pursuant to the agreement the company entered into with Icahn Partners and MHR Fund Management LLC. Merksamer will stand for election at the company’s 2013 annual shareholders meeting.
“We welcome Sam to the board and we look forward to his insights as we continue to execute on our plan to drive long-term profitability and deliver shareholder value,” said Lewis B. Campbell, Navistar’s chairman and CEO. “On behalf of the board, I would also like to thank Diane for her contributions and service to Navistar during her time as a director.”
Merksamer is a managing director at Icahn Capital LP, where he has served since 2008.
Navistar International Corp. is disappointed by large shareholder Carl Icahn’s campaign of “threats, attacks and disruption” and is committed to its plan to cut costs and review possible asset sales, the U.S. truck and engine maker said on Monday (Sept. 10).
“Navistar maintains an ongoing dialogue with its shareholders, and appreciates their input and views,” the company said in a statement. “As such, after a year of dialogue, we are extremely disappointed that Mr. Icahn has chosen to pursue his unproductive tactics of threats, attacks, and disruption.”
Reuters reported that billionaire investor Icahn slammed Navistar on Sunday for naming a new CEO without consulting large shareholders and urged the company to offer four board seats to shareholders immediately. The Navistar board’s recent decision to appoint Lewis Campbell as chairman and interim CEO was “worse than ill-advised,” Icahn said in an open letter to the directors.
The embattled U.S. truck and engine maker last month replaced CEO Daniel Ustian with Campbell, a former head of Textron Inc. after its bet on a new generation of diesel engines failed to live up to its promise.
“It is … outrageous that you have not reached out to obtain our opinion on issues such as choosing a new management team to lead this company,” said Icahn, who holds a roughly 15% stake in the U.S. truck and engine maker. “This is a board at war with its own shareholders. I urge you to reconsider the path the board has chosen, which harms our company and puts you at serious risk of personal liability.”
The investor said he would prefer to resolve the matter amicably rather than through protracted litigation and a proxy fight, but at the same time is seeking access to corporate documents and board proceedings at Navistar in order to protect his investment.
Carl C. Icahn has already had a busy year, having taken aim at companies like Clorox and Forest Labs. That hasn’t stopped him from adding yet another target to his portfolio.
According to a report in the New York Times, the activist investor disclosed on Thursday (Oct. 13) that he had built up a 9.8% stake in Navistar International, a maker of trucks, buses and Monaco brand RVs. In a securities filing disclosing his holdings, Icahn wrote that he had already held discussions with management, including about potentially adding members to the company’s board.
Icahn did not say anything more about his intentions. In the past, his playbook has ranged from pushing a company to explore a potential sale to actually making his own takeover bid, though with the hope that someone else will come in with a higher price.
His record for 2011 has been a bit mixed. While Mr. Icahn scored big with the sales of Motorola Mobility and Genzyme, his attempts to wrest control of the boards at Clorox and Forest Labs fell short.
Navistar has had a bumpy year, with its net income swinging from a loss for the first three months of 2011 to moderate profits. Last month, the company lowered the bottom end of its current fiscal year earnings guidance.
As of Thursday’s closing price of $38.68, Navistar had a market value of about $2.8 billion. Shares in the truck maker have tumbled more than 21% over the last 12 months. Based in Warrenville, Ill., Navistar has 18,700 employees and is parent to Monaco RV LLC and Workhorse Custom Chassis LLC.