Interpublic Group has announced it will appoint three new independent directors to its board in what appears to be a win for activist investor and IPG shareholder Elliott Management.
The new directors include: Deborah Ellinger, former CEO of The Princeton Review; Henry Miller, chairman of Marblegate Asset Management; and Jonathan Miller, partner at Advancit Capital, former chief digital officer of News Corporation and former CEO of AOL. They will replace two current directors, Jill Considine and Richard Goldstein, who will step down March 1.
The move ups the number of directors from nine to 10. The 10 directors will be the company's nominees for election at its 2015 annual shareholder meeting. The board has also established a Finance Committee, effective March 1, "to assist the board in reviewing and analyzing financial matters and operations, including a focus on furthering our progress toward achieving the company's target of fully competitive margins," according to the announcement.
Hedge fund Elliott Management last summer disclosed it had taken the equivalent of a 6.7% stake in the agency services holding company, saying it sought "constructive dialogue" with IPG's board on "steps to maximize shareholder value." People familiar with Elliott expected the firm to push for an IPG sale.
Michael Roth, chairman and CEO of IPG, said in a statement: "As we enter 2015, we felt it was important to build on our momentum, consolidate our achievements, reaffirm our commitment to further margin enhancement and position the company for continued value creation going forward. By refreshing our board and creating a new Finance Committee, we can accomplish all four of these key objectives. As such, we welcome Deborah Ellinger, Henry Miller and Jonathan Miller to the board and believe they will each make significant contributions as we continue to make strong progress toward achieving our previously announced target of 13% or better operating margin, building on the $1.8 billion of capital we have returned to shareholders since 2011 and providing our clients with cutting-edge creative and digital services."
Jesse Cohn, head of U.S. equity activism at Elliott Management, added, "We are pleased with the constructive dialogue we have had with Interpublic. The company has shown an impressive commitment to enhancing shareholder value, and Deborah, Henry and Jonathan have the right backgrounds and perspectives to help the board achieve this goal, both operationally and strategically. We look forward to ongoing collaboration with IPG's management and board."
The candidates chosen by the board of directors were identified through a search process IPG initiated last year, as well as evaluation of independent candidates recommended by Elliott Management, the company said.