Tenneco board changes draw ire of activist investor

Automobile areas maker Tenneco Inc. shuffled its board Friday in a shift that could provoke a struggle with former Icahn Enterprises executive Dan Ninivaggi, who in January demanded the board make additional-sweeping modifications or hazard a proxy fight.

Dennis Letham, a twelve-calendar year veteran board member, will become lead director effective April 1 in a shift that also shifts board member committee duties, the corporation said in a statement Friday. It’s the second change to Tenneco’s board this month, adhering to a Feb. 5 selection to appoint former Normal Motors CFO Chuck Stevens as a director.

The Lake Forest, Sick., provider of mufflers and other automotive components described the moves as governance advancements built to enrich impartial oversight of the board.

But Ninivaggi, who employed to run Icahn Automotive Group for billionaire Carl Icahn, has sought additional extensive structural modifications. He has urged Tenneco’s administrators to market all or element of the corporation and use the proceeds to spend down its $5.four billion personal debt load. The activist also has submitted his very own slate of seven director recommendations, which he did not publicly determine apart from to say the team does not contain Stevens.

“We were being not too long ago notified that they intend to contest my nomination letter,” Ninivaggi said Friday in an job interview. “Clearly the steps they are taking are currently being accomplished in response to my letter. They just cannot be trustworthy to pick out their very own administrators.”

A spokesman for Tenneco declined to remark.

Ninivaggi denied he is doing the job at the behest of Icahn, who owns 9.9{7e488363c11ee5ef50445c8c4fa770b6e6e4f99e57faea264a05ac52abb3ffe0} of the voting shares and 20.seven million Class B non-voting shares. Icahn offered areas maker Federal-Mogul to Tenneco in April 2018 for $5.four billion. As element of the offer, he agreed to a lockup until eventually April 1, through which time he are not able to get motion in opposition to the board.

Icahn has the ideal to obtain as much as fifteen {7e488363c11ee5ef50445c8c4fa770b6e6e4f99e57faea264a05ac52abb3ffe0} Class A Tenneco shares inside of 60 days, according to a regulatory submitting previously this month.

Associates for Icahn did not return a phone seeking remark.

Right after twelve several years with Icahn, Ninivaggi still left the billionaire’s expenditure fund past slide. He said he owns shares in Tenneco and thinks the latest board and executives are mismanaging the corporation, but Ninivaggi would not disclose the sizing of his stake.

When the offer with Federal Mogul was accomplished, the plan was to mix the two firms to get sizing and scale in their powertrain units and separately in DRiV, its enterprise that sells alternative components together with shocks, struts, brake and emissions areas. The merger was expected to unlock value by taking ways such as a spin-off of DRiV.

That hasn’t happened, and Ninivaggi complained in his January letter that management should be additional obvious about what they plan to do to create value.

With his slate possessing been rejected by the board, Ninivaggi said he will almost certainly end up in a authorized fight to get his director recommendations put to a shareholder vote.

“Some of the moves they have taken are positive, like placing Chuck on the board. But they should contain my enter in its place of fighting it. So much, they are fighting it.”