Elliott Management, one of five active investors in Salesforce, has named a slate of candidates for Salesforce’s board of directors. The move, confirmed by TechCrunch’s sources, is an indication that negotiations to resolve it have broken down without reaching that point. CNBC was first with the news.
“Elliott has been in constructive, but intense, dialogue with the company over the past few weeks, and has named a slate of directors to Salesforce’s board,” a person familiar with the matter told TechCrunch.
The person indicated that Elliott is putting more and more pressure on the company through negotiations and these nominations, and that the firm will be closely watching what happens when Salesforce reports earnings later today.
“And we’ll see what happens, basically, if and when they announce the things that Elliott wants to hear tonight, just improvements and overall changes to the company. And after the earnings come out, it’s that Time is when the firm will assess next steps.
When a firm nominates its slate of candidates to the board, the ultimate goal is to get a group of people on the board who can act on behalf of Elliott and implement whatever changes he has in mind. can They haven’t said publicly what they want, but it clearly includes cutting operating costs and increasing profits, possibly even shedding some non-core parts of the business.
So far the company has laid off 10% of its workforce and announced other changes such as reducing its real estate footprint in an effort to cut costs.
Elliott, who announced she was taking a multibillion-dollar stake in the company in January, isn’t the only activist currently working within the firm. Starboard Value, ValueAct, Inclusive Capital and ThirdPoint, which joined just last month, are also high-profile players investing in Salesforce. It is highly unusual for a company like Salesforce to have five employees working at the same time, and it may be the first time it has ever happened before.