Azenta makes board changes, takes other steps; avoids proxy fight with activist

By Svea Herbst-Bayliss

NEW YORK (Reuters) – Azenta on Monday announced strong earnings as well as changes to its board and said that activist investor Politan Capital Management, one of the biotechnology company’s biggest shareholders, will not be pushing for seats this year.

Azenta shares jumped nearly 12% in after-hours trading. The stock closed the regular session up 0.6% at $47.81.

Two new directors will join the board while two current directors will retire, the company said, adding that it will make an additional $500 million in share repurchases in fiscal 2024 and will focus on “smaller tuck-in acquisitions.” Revenue grew 25% in the fiscal fourth quarter, it added.

In return, Politan, which owned 7.5% of the company on Nov. 1, withdrew its notice to nominate director candidates for election, erasing fears that the hedge fund might launch a proxy fight this year.

Azenta and Politan had been holding private discussions for weeks to find ways of increasing shareholder value, people familiar with the talks said. Azenta’s stock price has tumbled nearly 19% since January. In after-hours trading the share price climbed to $54.92 before falling back to trade at $49.80.

Earlier this month, Politan had nominated directors to the board, taking a preliminary step to lay the groundwork for a possible proxy fight. But on Monday, the company said it has withdrawn its notice.

“We are encouraged by the Company’s recent operational performance, its commitment to increased capital returns, its focus on smaller tuck-in acquisitions, the CFO transition process that led to the addition of Herman Cueto, and the changes the Company is making to its Board,” said Quentin Koffey, who launched Politan roughly two years ago.

Previously, Politan pushed for changes at managed care company Centene (NYSE:) and medical devices maker Masimo (NASDAQ:).