AOL on Thursday appeared to win a proxy fight with activist investor Starboard Value, relieving some of the scrutiny on CEO Tim Armstrong's investments in online content businesses like Patch.com and The Huffington Post.
A majority of shareholders at AOL's annual meeting voted to re-elect all eight of AOL's current board members, rather than take on any of the three candidates proposed by Starboard Value, according to a preliminary estimate by AOL. A final count of shareholder votes is expected later Thursday.
The company thanked shareholders for their support and said it plans to respond "to the messages we heard from our investors." AOL added that it has "the right strategy and team" to continue providing value for its shareholders.
Starboard, which owns around 5.3 percent of AOL's outstanding shares, nominated Chief Executive Jeffrey Smith and two other candidates as part of ongoing efforts to gain influence over the internet company's online content businesses and other strategic decisions.
AOL and Starboard have for months traded blows over AOL's strategy, with Starboard taking particular aim at AOL's network of money-losing local news websites, Patch.com.
Armstrong has starkly defended his content investments as part of broader efforts to transform AOL into an advertising-revenue-driven media company, following its spin-off from Time Warner. He says AOL units like Patch, which he founded, need more time to become profitable.
In April, AOL announced a $1.06 billion deal to sell and license its patent portfolio to Microsoft, a deal that both AOL and Starboard have taken credit for initiating.
Starboard's Smith spoke briefly at the meeting, saying that shareholders and management agree that the company is undervalued and can achieve "substantial revenue growth and far more profitability."
AOL, Starboard Value, Chief Executive Jeffrey Smith, Starboard, shareholders, Tim Armstrong
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