NEW YORK, March 18, 2014 /PRNewswire/ -- BlueMountain Capital Management, LLC ("BlueMountain") today announced that one of the United States' leading independent proxy voting advisory firms, Glass, Lewis & Co. ("Glass Lewis"), recommends that shareholders of Taro Pharmaceutical Industries Ltd. (NYSE: TARO) vote FOR the BlueMountain nominees in Items 6.1 and 6.2 and AGAINST the company's nominees in Items 5.1 and 5.2 at the company's March 27, 2014 extraordinary general meeting. Glass Lewis also recommends that Taro shareholders vote AGAINST the approval and ratification of Taro's director and executive compensation proposals in Items 2, 3, and 4. BlueMountain is seeking to elect two new independent, external directors to protect the interests of all Taro minority shareholders.
The extraordinary general meeting has been called to address procedural flaws in the voting forms used at the annual general meeting held on September 12, 2013. Importantly, BlueMountain alerted Taro to these flaws prior to the annual general meeting. However, Taro took no action to remedy these flaws until BlueMountain filed a lawsuit in the Israeli District Court in November 2013 seeking to vacate most of the resolutions voted on at the annual general meeting. BlueMountain believes it is more important than ever to bring change to Taro's board.
In its report, Glass Lewis supports BlueMountain's call for change, stating:
"Given available disclosure, we continue to believe the Dissident's arguments – which are targeted, contextual and germane to the potentially undue influence exerted by Sun Pharma – shine a decidedly unfavorable light on the recent and disconcerting efforts of Dan Biran and Ilana Avidov Mor to act as independent directors of Taro."
In making its recommendation, Glass Lewis also stated that:
"…the election of Mr. Rosenfeld and Ms. Bershadsky would likely provide a much needed refresh of the external director role without encroaching upon the clear limitations imposed by Sun's majority ownership position and corollary influence on the broader board dynamic. Of equal import, we further concluded the two-member change would prospectively provide for a healthy review of Taro's compensation practices, a prospective push toward greater disclosure and a crucial restocking of independent advocates prior to any further deliberation of a major strategic transaction with Sun Pharma."
Institutional Shareholder Services ("ISS") has also recommended FOR BlueMountain's nominees and AGAINST the incumbents, stating, "A vote against the two incumbent nominees appears to be the most effective way available to shareholders to demand additional minority shareholder protections and improve the level of independent oversight at the board level."
BlueMountain issued the following statement:
"We appreciate Glass Lewis's recommendations, which confirm our view that Board change is required at Taro. We believe that representation is needed in the Taro boardroom to protect the interests of all minority shareholders. We again urge Taro shareholders to vote FOR Ben-Ami Rosenfeld and Adi Bershadsky in Items 6.1 and 6.2 today and AGAINST the re-election of the existing external directors in Items 5.1 and 5.2."
SOURCE BlueMountain Capital Management