AOL fended off a challenge to its board and strategy as a majority of shareholders elected all eight management-backed directors at the company’s annual meeting Thursday.
Activist investor Starboard Value fund had proposed three alternate candidates as it tries to get a bigger voice in AOL’s business after months of vocal disagreement. AOL didn’t release the vote tally immediately but said a preliminary count showed that all incumbents had been re-elected.
“We want to thank our stockholders for their strong support throughout this process. Over the past few months, we have met with many of our stockholders and greatly appreciate their feedback as well as their commitment to AOL,” the company said in a statement. “We intend to be responsive to the messages we heard from our investors.”
AOL was relieved, but Starboard’s failure clearly disappointed some. Its shares dropped by more than 8% after the morning meeting before closing down 5.6% at $25.57 in an otherwise upbeat market. AOL has been on a nearly decade-long quest to reinvent itself as an advertising-driven online media company since its once massive dial-up Internet business started to shrivel.
Rival Yahoo was less successful in a proxy battle with investor Third Point last month. The hedge fund succeeded in replacing three directors with its own nominees. It concurrently forced the ouster of Yahoo CEO Scott Thompson after discovering a fake degree on his resume.
AOL’s board includes CEO Tim Armstrong, Richard Dalzell, Karen Dykstra, Alberto Ibarguen, Susan Lyne, Patricia Mitchell, Fredric Reynolds and James Stengel.