April 27, 2016 / 2:18 PM / in 2 years

Marvell Technology to add three Starboard nominees to board

(Reuters) - Marvell Technology Group reached an agreement with Starboard Value LP on Wednesday, saying it will add three new directors nominated by the activist hedge fund, which has agitated for changes at the company since early this year.

Starboard, which holds a 6.5 percent stake in the U.S. chipmaker, will also designate an additional independent director, the company said.

Marvell had said in September it would cut about 17 percent of its workforce as it trims its mobile business to focus on automotive technologies and Internet of Things.

The chipmaker at that time also said it was investigating its accounting practices related to revenue recognition issues in the second quarter.

Starboard announced its stake in February, saying then it had retained semiconductor veterans Rick Hill, Oleg Khaykin and Jeff McCreary as advisers for its Marvell investment, an early indication the activist would propose them as board directors if the hedge fund and company could not come to terms on the path of the company.

In April, Marvell said its chief executive and president, a husband-wife duo who co-founded the company, were stepping down, though both remained on the board.

Due to its auditing issues, the company has not yet set an annual meeting date.

Even without the meeting date as a deadline, Starboard and Marvell’s advisers were able to reach a settlement to avoid any potential proxy fight.

Starboard’s Peter Feld, Richard Hill and Oleg Khaykin will join the company’s board, Marvell said.

Separately on Wednesday, Yahoo Inc announced a settlement with Starboard, granting it four board seats.

Additional reporting by Rishika Sadam in Bengaluru; Editing by Anil D'Silva and Meredith Mazzilli

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