Alere declares victory in proxy challenge

After months of backbiting and accusations, Alere ($ALR) has come out the other end of a proxy fight, getting all four of its board nominees elected and fending off an activist investor that wanted the company to pare down.

At Wednesday's annual meeting, stockholders picked Alere's candidates over those nominated by Coppersmith Capital Management, which owns about 7% of the diagnostics outfit, and Alere is calling the vote an affirmation of its corporate strategy.

Back in June, the private equity firm got the ball rolling on a proxy fight, recommending Alere sell off some of its units to generate about $4 billion and nominating three board members of its own to get the job done. That plan would boost shareholder value by as much as 136% and help reverse the toll of Alere's "expansion binge" over the past two years, Coppersmith said, raising cash to pay down the company's mounting debt.

In the protracted back-and-forth that ensued, Alere CEO Ron Zwanziger and Coppersmith co-founder Jerome Lande traded accusations of ineptitude and questioned one another's motives in a series of letters fired off to shareholders. However, in the end, Coppersmith's gambit wasn't convincing enough to investors, and Alere is moving forward as planned with the board it wanted.

"Our plan to improve organic revenue growth, drive higher operating margins and reduce leverage has been recognized," the company said in a statement. "While we are pleased with our progress to date, this process has only further sharpened our commitment to delivering strong results."

In a statement released Thursday, Coppersmith said that despite the defeat, it has secured promises that Alere will work to keep costs down and look to sell some extraneous units in the near term. But, in keeping with the tone of the of the fight to this point, Lande didn't quite sign off peacefully.

"Alere's nominees prevailed only because of the switch of support from Coppersmith to Alere at the 11th hour by two of the company's largest stockholders, we believe," Lande wrote in a statement. "This resounding level of support for Coppersmith's nominees, and the extraordinary commitments we believe management made to secure a last-second victory, make it clear that the clock is ticking for performance and accountability at Alere."

And while Alere can stop worrying about a proxy challenge, the spiking costs that irked Coppersmith remain quite real. Last quarter, the company's net loss more than tripled to $65.9 million despite 9.1% revenue growth.

- read Alere's statement
- check out Coppersmith's response

Editor's note: This story was updated to include a response from Coppersmith Capital Management.