- Hedge fund Shah Capital has urged Novavax shareholders to vote against the re-election of three directors and proposals related to executive compensation.
- Shah Capital, the third-largest shareholder of Novavax, has expressed concerns over mismanagement at the biotech company.
- The hedge fund plans to vote against directors Richard Douglas, Margaret McGlynn, and David Mott at Novavax’s shareholder meeting in June.
Shah Capital, a major shareholder of Novavax, is pushing for a board shakeup at the COVID-19 vaccine maker, expressing concerns over its management and executive compensation.
Shah Capital’s Push for Change
Shah Capital, which holds a near 7.5% stake in Novavax, has been vocal about its dissatisfaction with the company’s management. The hedge fund believes that Novavax is undervalued and continues to suffer from poor profitability. Last year, Novavax had raised doubts about its ability to remain in business, hurt by manufacturing snags and regulatory hurdles that delayed the entry of its protein-based vaccine to the market.
Concerns Over Mismanagement
Last month, Shah Capital expressed concerns over mismanagement at the Maryland-based biotech and urged it to adopt a marketing strategy to target consumers who are hesitant to receive mRNA vaccines. The hedge fund had previously stated its plans to put forward two of its own candidates for appointment to Novavax’s board, but did not formally submit any nominations.
Upcoming Shareholder Meeting
Novavax said in a proxy filing last week that it had not received any valid nominations from stockholders for its 2024 annual shareholder meeting, scheduled to take place on June 13. However, Shah Capital said on Monday that it plans to vote against directors Richard Douglas, Margaret McGlynn, and David Mott at the meeting. “We believe that fresh perspectives are desperately needed in the boardroom to steer Novavax towards sustainable profitable growth,” the hedge fund said in a statement.
Novavax’s Response
Novavax responded by saying it welcomes the perspectives of its shareholders and values their input. “We believe we have the right board in place to oversee Novavax’s strategy,” the company said in its response. Shah Capital also plans to vote against three other proposals, including one related to the compensation of some of Novavax’s executives.
Conclusion
As Novavax’s third-largest shareholder, Shah Capital’s push for change could have significant implications for the company’s future. The outcome of the upcoming shareholder meeting in June will be closely watched by investors and the wider market.
