Proxy advisor Glass Lewis on Wednesday recommended Illumina shareholders support two of Carl Icahn‘s board nominees, even as shares of the corporate raider’s company plummeted amid a possible federal investigation.
Glass Lewis advised stockholders of the San Diego genetic sequencing pioneer to vote against re-election of the CEO Francis deSouza and board Chair John Thompson.
The San Francisco-based advisory firm, which helps mutual funds vote their shares, recommended Illumina shareholders support Icahn’s nominees Vincent Intrieri and Andrew Teno, adding the company’s $7.1 billion acquisition of cancer test maker Grail had been a “costly, distracting, value-crimping millstone.”
The recommendation comes ahead of Illumina’s annual shareholder meeting on May 25.
But Icahn’s own challenges intensified on Wednesday, with his takeover company fielding inquiries about its operations from federal prosecutors, a week after being accused it of over-valuing its assets.
Icahn Enterprises LP confirmed it had received inquiries from prosecutors in the Southern District of New York and reported a surprise quarterly loss on Wednesday.
The company’s shares sank to a 13-year low at one point after short seller Hindenburg Research published a report on May 2 accusing Icahn of over-valuing its assets and relying on a “Ponzi-like” structure to pay dividends.
Icahn Enterprises said it was cooperating with prosecutors and that the U.S. Attorney’s office has not made any claims or allegations against it or Icahn.
A spokesman for the U.S. Attorney’s office declined to comment.
Reuters contributed to this article.
