Herbalife (NYSE: HLF ) announced today that it will add two new Icahn Enterprises (NASDAQ: IEP ) representatives to its now 11-member Board of Directors . Billionaire Carl Icahn and his investment entities currently own approximately 13.6% of Herbalife's shares , and this most recent agreement symbolizes a potentially positive step for the network marketing company's strategic direction.
In a statement today, Herbalife Chair and CEO Michael O. Johnson said:
We are pleased to have reached this agreement and look forward to working with the Icahn representatives as members of our Board of Directors. We appreciate the Icahn Parties' shared views on the inherent value of Herbalife's operations, products and future prospects.
Per the agreement, the Icahn representatives are obligated to vote their shares in support of the Board's director nominees, as well as adhere to certain standstill provisions. Icahn Enterprises will receive the right to increase its ownership to 25% of total shares .
Mr. Icahn remarked in a statement today:
We conducted considerable research on Herbalife and its business before making our investment in the Company, and have great respect for its Board and management team, and believe in the Company's great potential. We expect our shareholder representatives to provide positive input into Board decisions affecting the future of the Company.
Mr. Icahn has not disclosed his picks for the two positions , to be added immediately preceding Herbalife's annual shareholder meeting . In a sign of market approval, Herbalife shares rose 7.6% today .