Masimo and activist investor Politan clash over CEO replacement, shareholders to vote

From Nasdaq: 2024-07-05 11:59:00

Masimo and activist investor Politan Capital Management are in a battle over the former’s leadership. Politan wants to replace CEO Joe Kiani and has proposed two candidates for the board. Masimo has accused Politan of false narratives and released documents to support Kiani. A proxy vote will decide Kiani’s fate at the annual general meeting on Jul 25.

Politan invested in Masimo in 2023, aiming to change its corporate governance for better oversight and accountability. It won a proxy vote last year, placing two members on Masimo’s board. Politan blames Masimo’s weak share price performance on its acquisition of Sound United in 2022.

Masimo has launched a website to refute Politan’s claims and defends its CEO Kiani. Nearly 300 engineers and the COO have publicly supported Kiani, warning that their departure is possible if he is replaced. Masimo’s shares have been on a decline year to date, and ongoing litigation with Apple over patent issues remains a concern.

The wearable healthcare devices market is expected to grow, posing an opportunity for Masimo. A ban on Apple’s two watch models due to the ongoing dispute may benefit Masimo’s W1 watches. The potential removal of Kiani could lead to a settlement with Apple. Masimo faces challenges from internal and external factors.

Masimo is currently facing challenges from significant players, impacting its shares unfavorably. If Kiani wins, Masimo will face more pressure from Politan and the Apple fight. In the case of Kiani’s ouster, the company may lose its key management and engineers, affecting its performance. Masimo currently carries a Zacks Rank #2 (Buy).



Read more at Nasdaq: Masimo (MASI) Fights Politan in a Bid to Retain CEO on Board