Shares of cloud content management platform Box Inc. (BOX) - Get Box, Inc. Class A Report fell Tuesday after the company announced that it has made multiple amendments to its governance process amid pressure from activist investment group Starboard Value.
The company will now require a majority of votes cast to elect new directors to its board, a change from its previous process of allowing just a plurality of votes, among other changes.
"These proactive actions, coupled with the separation of the chair and CEO roles and the significant refreshment our board has undergone – seven new directors appointed to the board over the last three years – further demonstrate our commitment to strong corporate governance and oversight," the company said Tuesday.
The Redwood City, Calif., company also said that Starboard had originally been on board with private equity firm KKR & Co Inc.'s (KKR) - Get KKR & Co. Inc. Class A Report $500 million investment in Box before turning against it and calling it a bad deal before launching its proxy battle against the company.
Box says that Starboard made an unsolicited request to participate in the investment round led by KKR despite being publicly against the transaction after the investment was made.
Starboard owns an 8% stake in Box. Box shares were down 3% to $26.13 Tuesday at last check.
The company also eliminated the supermajority voting requirements to alter its bylaws and approved the elimination of the supermajority vote requirement to amend certain provisions of its restated certificate of incorporation.
In March, Box shares surged amid reports that the company was exploring a sale after being pressured by activist investors including Starboard Value.
In 2019, Starboard had disclosed a 7.5% stake in Box and the company at the time said that it was willing to work with the investment firm.
Editor's note: This story has been updated. Only new directors need a majority of votes.