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The Morning Brief: Proxy Advisors Split on Starboard Plan for Darden Meeting

The hedge fund firm’s Jeffrey Smith hopes to stop a proposed spinoff of Red Lobster before the annual meeting

The battle lines are being drawn among proxy advisors as Starboard Value seeks support for its solicitation to call a special meeting of shareholders of casual-dining chain operator Darden. Shareholders will be asked to consider a non-binding resolution urging the Darden board not to approve a proposed separation or spinoff of its Red Lobster chain before the 2014 annual meeting. Starboard, headed by Jeffrey Smith, said in a press release that both Institutional Shareholder Services and Glass Lewis & Co. are recommending that Darden shareholders support the hedge fund firm’s efforts. On the other hand, Darden said proxy advisory firm Egan-Jones Proxy Services has recommended that shareholders reject Starboard’s efforts.

Egan-Jones reportedly stated: “We believe that shareholders should communicate their views directly to the company and that Starboard’s proposed special meeting is an inadequate alternative to voice their concerns on the proposed Red Lobster separation. Further, we believe there are alternatives to a special meeting already available to shareholders that make a special meeting unnecessary. Lastly, we are confident in the initiatives the company has planned to improve performance, address changing industry dynamics in the casual-dining sector and enhance shareholder value.”

The Pershing Square Foundation, founded by Pershing Square Capital Management’s William Ackman and his wife, Karen Ackman, have donated $17 million to Harvard University, their alma mater. The award is earmarked for Harvard’s Foundations of Human Behavior Initiative, which immediately announced the establishment of three endowed professorships and a $5 million research venture fund open to all Harvard faculty, doctoral students and postdoctoral fellows. “FHB’s work will enable researchers to identify cost-effective, scalable solutions to societal challenges in areas ranging from health care and economic development to education and government,” the announcement said. The Pershing Square Foundation has already committed $235 million in grants and social investments.

Tiger Global Management confirmed in a regulatory filing that it raised $1.5 billion for its latest venture-capital fund, Tiger Global Private Investors VIII. We earlier reported it was looking for somewhere between $1 billion and $1.5 billion and that the offering, which closed April 1, was over-subscribed.

Shares of Herbalife rebounded Monday, jumping 4.41 percent to close at $53.75, after falling 14 percent on Friday following a report that the multi-level marketer of nutrition supplements was a target of a criminal investigation.

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