( ESNUG 503 Item 1 ) -------------------------------------------- [05/04/12]
From: John Cooley <jcooley=user domain=zeroskew got calm>
Subject: MENT board whacks 2 out of Icahn's 3 cronies in clever maneuver
On Monday, OregonLive.com reported a clever last minute maneuver by MENT to
eliminate 2 of Carl Icahn's 3 hand-picked directors that Icahn had elected
onto the MENT board last year:
"In its annual proxy filing today, Mentor recommended shareholders
give Icahn nominee David Schechter another year on its board.
Schechter is an Icahn portfolio manager.
Mentor suggested that shareholders replace two other Icahn nominees,
Jose Maria Alapont and Gary Meyers.
In their place, Mentor nominated:
- Keith Barnes, a chip industry veteran, former board member of
the Oregon Growth Account, and onetime division president at
Mentor rival Cadence Design Systems. Barnes is also the former
chief executive of chip testing company Verigy Ltd.
- J. Daniel McCranie, another chip industry veteran who previously
served as chief executive of two publicly traded semiconductor
companies, Virage Logic and SEEQ Technology.
Mentor's board members serve one-year terms."
- OregonLive.com (04/30/12)
In quick response, Carl Icahn, who owns ~15 percent of MENT shares, filed
an open letter to the MENT board with the Securities and Exchange Commision
in Washington, DC:
"Gentlemen:
As the company's largest shareholder, we are disappointed by the Board's
decision not to re-nominate Gary Meyers and Jose Maria Alapont, two of
the three directors elected by shareholders as a result of our proxy
contest last year. We view this action as an affront to shareholders and
shareholder democracy -- especially given that ISS recommended last year
that shareholders vote FOR both Messrs. Alapont and Meyers.
This action, in combination with the board's recent decision to extend
the company’s poison pill without shareholder approval -- a practice
frowned upon under the ISS proxy voting guidelines -- clearly indicates
that the company's long track record of poor corporate governance has
still not changed. Apparently, our three nominees, as a minority on a
board with a still-entrenched majority, were unable to prevent this
contemptuous behavior.
While it is past the deadline for nominating directors at this year's
annual meeting, we wanted to inform you and the rest of the company's
shareholders that these actions have not gone unnoticed.
Very truly yours,
Carl C. Icahn
What's odd is Icahn's personal staff did NOT see this maneuver coming until
it was too late. (Huh?? Doesn't Icahn's staff have decades of experience
with hostile take-overs??? This can't be the first time a target board
pulled a stunt like this? After all, MENT fought hard to NOT have these
3 Icahn directors -- why would MENT renominate any of them??? D'oh!)
---- ---- ---- ---- ---- ---- ----
Tactically, MENT nominating two EDA/semi veterans to replace Icahn's two
booted MENT board was brilliant. "These guys know chips and EDA. It makes
perfect sense to have them on the board." Brilliant.
---- ---- ---- ---- ---- ---- ----
The gossipy backstory here is about who the MENT board decided to eliminate.
Dumping Jose Maria Alapont was a fairly easy decision. He's neither an EDA
veteran nor a chip guy plus:
"Mentor's board did not explain its decision on Icahn's nominees, but
the company did note in its proxy filing that Alapont attended fewer
than 75 percent of the 19 board meetings held in the last year."
- OregonLive.com (04/30/12)
But dumping Gary Meyers, the former CEO of Synplicity, who has an impressive
17 years of EDA/semi experience is a whole other matter. The facts are not
known publically -- so, as usual, rumor steps in to fill the vacuum.
  
Years ago, the moment when Carl Icahn nominated Gary Meyers to be on MENT's
board, a rumor went: "Aha! Gary must of been the one who told Icahn about
MENT's and CDNS's financials! Because 99.9999999% of the time, Wall Street
doesn't even know that EDA exists. That's how Icahn found us!"
If true, the MENT board dumping Meyers could just be Wally's revenge for
bringing this Icahn nightmare into MENT (and CDNS).
Or it could be that Wally, who has ModelTech/Exemplar, might not like the
idea of working for his old Synplicity rival.
Or it could be that Wally and Meyers don't agree on how to run MENT, and
Meyers lost the power struggle. After all, Wally's MENT had record sales
of over $1 billion last fiscal year, plus under his leadership MENT beat
out Cadence for the #2 spot in overall EDA revenues. It's kind of hard to
argue with success.
I guess it all depends on what rumors you hear, and believe.
- John Cooley
DeepChip.com Holliston, MA
---- ---- ---- ---- ---- ---- ----
Related articles:
78% of MENT customers rate Wally's Mentor as "Generally Positive"
88% of MENT customers greatly fear a Synopsys-Cadence duopoly
81% of EDA users disapprove of proposed Cadence-Mentor merger
MENT Board warns of Anti-Trust issues in a CDNS or SNPS merger
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