Herbalife Ltd. (HLF) To Nominate 3 More Icahn Board Candidates

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Herbalife Ltd. (NYSE:HLF) continues to battle allegations made by Bill Ackman that it is a pyramid scheme, and it sounds like the company will increase its reliance on Icahn for help. In a regulatory filing this morning, Herbalife stated that it will nominate Hunter C. Gary, Jesse A. Lynn and James L. Nelson—all of whom are Icahn’s designees.

Ackman and Icahn have had a longstanding feud, and Icahn has been siding with Herbalife Ltd. (NYSE:HLF) since Ackman announced he was shorting the company.

Herbalife amends agreement with Icahn

According to the filing with the Securities and Exchange Commission, Herbalife Ltd. (NYSE:HLF) has amended its agreement with Icahn Enterprises Holdings L.P. and “certain related entities.” Together, these entities own 17 million shares of Herbalife’s stock, which amounts to 16.8% of the nutritional supplement company’s outstanding shares.

The company will name Gary, Lynn and Nelson as nominees for election to its board of directors at this year’s annual shareholders’ meeting. That meeting is set for April 29. Icahn also posted details of the agreement on his Facebook page.

Background on Icahn nominees

Gary and Lynn both work for Icahn Enterprises, and Herbalife Ltd (NYSE:HLF) said it would nominate them for election to the Class I directorships which are currently held by Michael Levitt and Carole Black. Both directors’ terms end at this year’s annual meeting. Herbalife also states that Colombe M. Nicholas will resign from its board of directors. The company will nominate Nelson to replace Nicholas on the board of directors. Currently Nelson is an independent director of Icahn Enterprises L.P. Herbalife will nominate him to serve the rest of Nicholas’ Class II directorship.

If shareholders approve the addition of Gary, Lynn and Nelson to Herbalife Ltd. (NYSE:HLF)’s board, that will mean Carl Icahn has five designees on the company’s board, as currently he has two who are already on the board. Herbalife stated that the size of its board of directors will remain at thirteen.

Icahn parties have agreed to still vote their shares for all of Herbalife Ltd. (NYSE:HLF)’s director nominees at the next shareholder meeting. Also they still have the right to increase the size of their stake in Herbalife up to 25% of outstanding shares.

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