LOS ANGELES — Nutrition and weight-loss company Herbalife will allow three more representatives of billionaire investor Carl Icahn to join its board, sending the company’s shares up as much as nine percent before the bell on Monday.
As part of an amended agreement with Icahn, Hunter Gary, Jesse Lynn and James Nelson would be put up for election, according to the company, giving Icahn five seats on the 13-member board.
Herbalife, whose business practices are being investigated by the Federal Trade Commission (FTC), earlier postponed its annual shareholders’ meeting to April 29 from April 24 in order to continue talks with Icahn about an increase in board representation.
Icahn, Herbalife’s biggest shareholder with a 16.8 percent stake, has been supporting the company in its fight against fellow billionaire investor William Ackman.
Ackman, who heads Pershing Square Capital Management, has called Herbalife’s distribution model a “pyramid scheme” and has run up huge losses since taking out a short position of about $1.16 billion on Herbalife’s shares.
Icahn in a statement:
“We remain resolute in our commitment to the long term success of Herbalife.”
Icahn continues to have the right to buy up to 25 percent of Herbalife, according to the statement.
Carole Black, Michael Levitt and Colombe Nicholas would step down from the board, according to Herbalife.