May 16, 2011 / 5:48 PM / 6 years ago

CORRECTED-Visteon director critical of treatment of investor

3 Min Read

(Corrects fourth paragraph of May 13 story to show Alden and affiliate own 3.5 percent of Visteon, not 10.5 percent)

DETROIT, May 13 (Reuters) - Visteon Corp (VC.N) was "irresponsible" in its effort to thwart a top shareholder from nominating board members, according to a Visteon director who is resigning from the auto supplier's board.

William Redmond told the company that he would resign on May 8 and his resignation would be effective on May 20, according to Visteon filing with U.S. securities regulators this week.

In a letter attached to the filing, Redmond said Visteon exhibited "poor handling" of its shareholders, including Alden Global Distressed Opportunities Master Fund LP.

Alden, a hedge fund based in the Cayman Islands, sought to nominate directors to Visteon's board during the company's upcoming annual meeting in June. Alden and its affiliate own about 3.5 percent of Visteon.

Visteon asked Alden to hold off until after the meeting and said it would consider two directors in September, according to Redmond's letter, which was filed with the U.S. Securities and Exchange Commission on May 12.

Visteon hired legal counsel and a public relations firm to "gird for a proxy fight" in case Alden rejected the proposal, Redmond said.

"Spending the money of the people who own this company to battle the reasonable agenda they have put forth and do so at the expense of value creation is, in my view, irresponsible," Redmond wrote in the letter dated May 8.

The letter came days before Visteon announced it would add two new directors to its board by Aug. 1. Those directors will be culled from pool of candidates recommended by Alden.

Visteon also disclosed Redmond's exit in the press release, saying one of the directors would replace Redmond, who joined Visteon's board after its emerged from bankruptcy protection on Oct. 1.

Visteon said it "reached an agreement with Alden that is consistent with the best interests of all of its shareholders," in the May 12 SEC filing. (Reporting by Deepa Seetharaman; editing by Carol Bishopric)

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