March 22, 2018 / 10:43 PM / 8 months ago

Forest City not to sell itself, nine directors to resign

(Reuters) - Forest City Realty Trust Inc (FCEa.N) will not sell itself after completing a strategic review, and has agreed with three activist investors to have nine directors resign and largely be replaced by independent nominees, it said on Thursday.

Investors Starboard Value and Scopia Capital Management will each appoint one director, while RMS, Ltd will nominate two, Forest City said in a statement.

During the strategic review, which began in September, Forest City reached out to more than 50 potential acquirers and entered into exclusive talks with a large financial institution, but the talks broke down over price and closing conditions, the company said.

The change is a victory for the investors, which have successfully pushed for changes to the company’s corporate governance practices that have reduced the influence of Forest City’s founding Ratner family.

In recent years, Forest City has scrapped its dual-class share structure, shaken up its board and sought to shed some non-core assets.

It has also largely unwound what was once a sprawling corporate structure that included hotels, military housing, retail centers, and a stake in the Brooklyn Nets basketball team.

Based in Cleveland, Ohio, Forest City is primarily focused on office and apartment buildings in core urban markets, such as New York and San Francisco, as well as mixed-use urban developments.

Reporting by Arunima Banerjee in Bengaluru and Carl O'Donnell in New York; Editing by Shounak Dasgupta and Richard Chang

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