Breaking News
Investing Pro 0
⏰ React to the Market Faster with Custom, Real-Time News Get Started

Salesforce appoints new board directors amid activist investor pressure

Stock Markets Jan 27, 2023 11:03AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. A logo of Salesforce is seen at its exhibition space, at the Viva Technology conference dedicated to innovation and startups at the Porte de Versailles exhibition center in Paris, France June 16, 2022. REUTERS/Benoit Tessier
 
MSFT
+1.05%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
EBAY
+0.49%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
ADBE
+1.62%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
MA
-0.77%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
CRM
+1.40%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
BHC
-0.69%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Svea Herbst-Bayliss

(Reuters) - Salesforce (NYSE:CRM) Inc on Friday named three new board directors, including the chief of hedge fund ValueAct Capital, amid pressure from activist investors for better cost control and a management shakeup at the cloud-based software firm.

The company appointed the chief executive of hedge fund ValueAct Capital, Mason Morfit, Mastercard (NYSE:MA) finance chief Sachin Mehra and former chief executive of Carnival (NYSE:CCL) Corp Arnold Donald to its board. 

The men will join on March 1 when two directors, who have each served two decades, will be leaving.

The moves have been long-planned as lead independent director Robin Washington has been steering the process to focus more on operational skills since last summer, a person familiar with the matter said on Friday.

However, the appointments also come as the company has been facing pressure publicly and privately from four prominent activist investment firms. Elliott Management, the biggest among them, is set to launch a board challenge next month.

Elliott, which invests over $55 billion, has been engaging with Salesforce for roughly a week and is currently interviewing candidates that it plans to nominate as directors, people familiar with the matter said on Friday.

Additionally Starboard Value, run by Jeffrey Smith, Inclusive Capital, run by Jeffrey Ubben, and ValueAct, which was founded by Ubben, have owned shares in Salesforce for months and have held talks with the company, sources said.

Starboard has pushed for considerable cost cuts while other investors have criticized recent acquisitions and pay at the company.

Many activist investors push target companies to add a shareholder to the board to represent investors' views.

By picking ValueAct's Morfit, Salesforce likely made a calculated bet that the San Francisco-based investment firm, which has a reputation for working collaboratively behind the scenes, might be more agreeable on the board than other activists, bankers and lawyers said.

Morfit has served as a director at Microsoft (NASDAQ:MSFT) and Valeant Pharmaceuticals (NYSE:BHC).

ValueAct has deep experience in aiding software companies with transformations, having served on the board of Microsoft and Adobe (NASDAQ:ADBE), which have ballooned in size since ValueAct's involvement.

At the same time Elliott has also made significant investments in technology companies and has won board seats at companies including Pinterest (NYSE:PINS), Twitter and eBay (NASDAQ:EBAY).

Elliott's decision to wage a proxy contest signals a quick shift from when the firm reached out to Salesforce. Jesse Cohn, managing partner at Elliott, said on Sunday that he was looking forward to working "constructively" with the company and that he has "developed a deep respect for Marc Benioff," Salesforce's co-founder and co-chief executive.

Salesforce's stock price, which has climbed up 22.5% this year, rose modestly at the start of trading on Friday.

Earlier this year, the company announced plans to cut 10% of its jobs and close some offices after rapid pandemic hiring left it with a bloated workforce.

    Salesforce directors Sanford Robertson and Alan Hassenfeld, board members since 2003, will not stand for re-election, the company said.

Salesforce appoints new board directors amid activist investor pressure
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email