(Bloomberg) -- Philip Falcone's HC2 Holdings Inc. has reached an agreement with the activist investor pushing for changes at the company that will see four new directors appointed to its board.
Two directors nominated by activist investor MG Capital Management, including its managing partner Michael Gorzynski and Kenneth Courtis, will also join the board of the holding company as part of the deal, the company said in a statement Thursday, confirming a Bloomberg News report.
Avram Glazer, the owner of the soccer team Manchester United, will also take over immediately as chairman as part of the settlement. Shelly Lombard, who was nominated by another investor, will also be added to the reconstituted seven-member board.
Incumbent directors Robert V. Leffler, Jr., Lee S. Hillman and Julie Totman Springer said they will not stand for re-election at this year's annual general meeting to make room for the new directors.
Falcone is expected to remain chief executive officer under the terms of the deal although that could still change, according to people familiar with the matter who asked not be identified because the situation is private.
MG Capital, which owns a more than a 6% stake in HC2, had been seeking to replace the entire six-member board, including Falcone, arguing it is undervalued and being mismanaged.
Two prominent shareholder advisory firms have sided with MG Capital. Institutional Shareholders Services Inc. urged shareholders to support three MG Capital nominees for the board to replace Falcone and two other directors, while Glass Lewis & Co. backed the entire slate.
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