Oshkosh urges anti-Icahn vote; CEO declines raise

Mon Nov 21, 2011 1:31pm EST

* Board tells shareholders to 'disregard' Icahn salvo

* CEO Szews declines raise, equity compensation

* Top execs could get up to $39 mln in change of control

Nov 21 (Reuters) - Oshkosh Corp's board of directors has told shareholders to "disregard" an opposition proxy statement from Carl Icahn, setting up a potential battle between the Wisconsin-based truck maker and the billionaire investor at the company's upcoming annual meeting.

Investment funds affiliated with Icahn accumulated a 9.5 percent stake in Oshkosh earlier this year and then he nominated six associates to the board in early November.

In its preliminary proxy statement, sent to shareholders late last week, the board said it "recommends a vote 'for' the election of each of the board's nominees... and urges you not to sign or return or vote any proxy card sent to you by the Icahn Group."

The board said Chief Executive Charles Szews has declined taking a raise and equity compensation this year in light of tough market conditions. However, he and other top executives could be in line for nearly $40 million in payouts if they were terminated without good cause under a change in company control.

"Responding to proxy contests and other actions by activist shareholders can be costly and time-consuming, (can) disrupt our operations and (can) divert the attention of management and our employees," the company said.

While Icahn has been mostly silent on his plans for Oshkosh's future direction, his move to purchase about 10 percent of its rival Navistar International Corp in October fueled speculation that he wants to merge Oshkosh with another player in the truck sector.

Icahn recently forged a pact with Navistar officials that potentially eases the path for an eventual merger with another company.

Icahn officials did not immediately return calls seeking a comment. Icahn's timetable for sending proxy materials to Oshkosh shareholders is unclear.

The date of the annual meeting has not yet been set, although the event could take place in late January or early February in Oshkosh, Wisconsin, if the company follows its recent pattern.

Oshkosh shares were down 5 percent to $19.72 in early afternoon trading on Monday, and have lost over 40 percent this year.

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