Harmonic says Solomon steps down as chairman

Harmonic says Gallagher replaces Solomon as chairman; announces proxy fight and stock buyback

Associated Press

SAN JOSE, Calif. (AP) -- Video services provider Harmonic Inc. on Monday said that Patrick Gallagher has replaced Lewis Solomon as the chairman of its board of directors and that Solomon will retire from the board later in 2013.

The company also announced that shareholder Voce Catalyst Partners plans to nominate its own candidates for three places on Harmonic's board of directors.

In a third development, Harmonic announced a modified "Dutch auction" stock repurchase of up to 16 million shares. Harmonic said it will pay between $5.75 and $6.25 a share, and plans to buy back about 14.1 percent of its stock. The Dutch auction will start Friday.

Its shares advanced 30 cents, or 5.4 percent, to $5.81 in premarket trading on Monday.

Gallagher has been on the board of directors for Harmonic since October 2007. Solomon had been chairman since June 2008 and has been on the board since 2002. Harmonic said Solomon relinquished his role as chairman on Thursday and will step down from the board before the company's annual shareholder meeting.

Voce Catalyst Partners LP, which owns about 106,000 shares of Harmonic, plans to nominate three candidates to the board at that annual meeting. Harmonic said it will evaluate the nominees and make a recommendation to shareholders. It said Voce Catalyst Partners holds less than a 0.1 percent of its shares.

Under the modified Dutch auction, Harmonic stockholders notify the company how many shares they'd like to sell and at what price within the announced range. The company reviews the offers and determines the lowest share price within its range that would enable it to buy back the shares it wants.

Harmonic is scheduled to report its first-quarter results after the market closes on Tuesday.

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