Verint Rejects Neuberger Berman's Call to Replace Directors
(Bloomberg) -- Verint Systems Inc. has rejected Neuberger Berman Group’s call to replace three of its directors after the software company’s improved financial outlook and share price allowed it to push back on the investor’s demand for an overhaul.
Neuberger Berman, which holds 2.6 percent of Verint, nominated the directors for election at the company’s 2019 annual general meeting. Melville, New York-based Verint said it had reviewed the nominees and found none of them had skills that would add value to the board, according to a letter sent to shareholders on Tuesday that was seen by Bloomberg.
“We believe our board, which is comprised of eight highly qualified individuals with a balance of experiences and skills, is highly capable of evaluating strategic decisions and providing management oversight to ensure we maximize the company’s potential,” Verint Chief Executive Officer Dan Bodner wrote in the letter.
Verint’s shares have risen about 56 percent in the past 12 months, outperforming the 4 percent gain in the Russell 2000 Index over the same period. The company last month raised its guidance for the current fiscal year for a second time.
Benjamin Nahum, a portfolio manager at Neuberger Berman Intrinsic Value Fund, said the board needs more experience with cloud migration, capital allocation and analyzing corporate structure. Neuberger wants to work constructively with Verint, he said, declining to comment on whether it was prepared to launch a proxy fight.
“We’re encouraged that the near-term trends are positive,” Nahum said in an interview. “This is our largest commitment in terms of our fund. We’re big believers in the company’s technology and the company’s potential.”
Neuberger Berman’s nominees include Oded Weiss, a strategic adviser to and former president of Temenos AG, Mark Greene, the former CEO of Fair Isaac Corp. and Beatriz Infante, the former CEO of Aspect Communications Corp.
Verint makes software that helps its users identify opportunities to engage with their customers and find security threats by analyzing vast amounts of data from voice, video, text and social media sources. The company said it had added three new directors in the past three years, including one in 2017 at the recommendation of Neuberger Berman.
Neuberger Berman is not a traditional activist investor. Earlier this year, it emerged as a white knight in a proxy fight between Ashland Global Holdings Inc. and Cruiser Capital Advisors LLC by throwing its support behind the chemical maker after it agreed to add two new independent directors and change some board assignments.
Verint reviewed a total of seven candidates that Neuberger Berman suggested before the investor formally nominated three, according to people familiar with the matter. One person withdrew from the running almost immediately and was replaced by another nominee, while two more had been interviewed and rejected previously, the people said. Only one of the three people that Neuberger Berman finally presented was part of the original group of nominees, they said.
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