* Target, Ackman face off at annual meeting
* Ackman seeking five seats on Target board
Waukesha, Wis. May 28 One of the season's
highest-profile proxy battles is being put to a vote on
Thursday as activist investor William Ackman and Target Corp
(TGT.N) face off at the retailer's annual meeting.
In an increasingly heated proxy contest, Ackman is seeking
enough shareholder votes to win five seats on the retailer's
board, while Target is running a slate of four incumbent
Shareholders will also have to vote on the size of the
board -- Target wants to set it at 12, while Ackman claims it
should be 13.
Ackman, whose Pershing Square Capital Management has a 7.8
percent stake in the retailer, launched his proxy contest in
March after Target rejected his proposal to spin off the land
under its stores into a real estate investment trust to boost
its stock price.
He has since said that he is running the proxy contest in
order to add executives to Target's board who have expertise in
credit cards, real estate and food retailing.
But Target contends he is seeking the seats simply as a way
to push through his risky real estate transaction.
The proxy contest is seen as an unusual one because many
analysts and investors have praised Target as a best-in-class
retailer with a capable management team.
Target shares are up about 15 percent this year, while
those of rival discounter Wal-Mart Stores Inc (WMT.N) are down
But some have acknowledged that Ackman, who is known for
well-researched and often successful proxy battles, could bring
a fresh perspective to its board and push the insular retailer
to explore new business opportunities.
Ahead of the meeting, Ackman won the support of
RiskMetrics, the leading shareholder advisory firm. It
recommended Target shareholders vote to elect Ackman and former
Starbucks Chief Executive Jim Donald to the board. Target
disputed the RiskMetrics report, saying it contained statements
that were "inaccurate or misleading."
Meanwhile, proxy advisory firm Glass Lewis & Co recommended
that shareholders vote for all of Target's nominees, while
Proxy Governance recommended that shareholders elect two of
Ackman's five dissident board nominees.
(Reporting by Nicole Maestri; Editing by Steve Orlofsky)