Risk & Compliance

Icahn Slate Wins Blockbuster Vote

Chief executive officer John Antioco is now the former chairman.
Stephen TaubMay 12, 2005

After winning his proxy fight with Blockbuster Inc., Carl Icahn is extending an olive branch, after a fashion, to chief executive officer and now former chairman John Antioco.

Although results won’t be official for several days, Icahn and two fellow dissidents, Edward Bleier and Strauss Zelnick, won seats as directors of the embattled video rental chain, and Antioco was removed from the board.

In the days leading up to the annual meeting, Icahn had publicly lambasted management for its poor strategic decisions and profligate spending, and had called on the company to use its cash to raise the dividend. Afterward, Icahn stated that he will not suggest strategic changes for the company. “I am not here to micro-manage,” he said, according to Reuters. “That would be presumptuous. What I want to see is that they are held accountable for performance.”

Blockbuster directors also approved a resolution calling for them to meet “promptly” to reappoint Antioco to the board, reported Reuters. He remains chief executive officer.

According to The Wall Street Journal, Icahn told reporters: “We support him [Antioco] staying. We don’t want to give him $50 million to walk away.” In fact, observed the Journal, Antioco would be entitled to $54 million in severance if he left the company, as he had threatened to do if he were not re-elected.

It is far from guaranteed that Antioco will accept a reappointment to the board. “I’d be lying if I told you this was a happy day because it’s not,” said a visibly unhappy Antioco at the meeting, according to published accounts.

In an official statement issued later, Antioco said only: “Blockbuster is a world-class brand that I believe has great potential for future success. I continue to believe in the business strategy we have been implementing.”