Aimia Inc.’s largest shareholder took a shot at the company’s board and missed the bull’s eye, but it still managed to inflict some damage.
Seven out of eight Aimia AIM-T directors – including chief executive officer Phil Mittleman and president Michael Lehmann – were re-elected Tuesday at the company’s annual general meeting. David Rosenkrantz, who has served on the board since 2020 and was its most recent chair, was the sole nominee who did not win majority shareholder support.
The result is a defeat for Mithaq Capital SPC, a family office based in Saudi Arabia that owns almost 20 per cent of Toronto-based Aimia and had publicly campaigned for the board’s removal. It is also an affirmation of Aimia’s strategy to reinvent itself as an investment holding company after selling its flagship Aeroplan loyalty program to Air Canada in 2019 for $516-million.
Shareholder support for the Aimia leadership team, however, remains far from absolute. In addition to voting out Mr. Rosenkrantz, shareholders did not give the company majority support for its executive compensation structure.
Although the rejection of the resolution known as “say on pay” is not binding, it nonetheless represents a major rebuke of the company’s leadership team. That is at least partly because Aimia completely overhauled its executive compensation plan after last year’s say on pay vote received support from only two-thirds of shareholders, which the company described in public filings as “unsatisfactory.”
Aimia hired a compensation consultant and sought feedback from more than 50 shareholders representing more than 60 per cent of its outstanding shares “to better align realized pay with shareholder returns,” the filings said. Still, by voting down the say on pay resolution, the majority of Aimia’s shareholders made it clear they remain unsatisfied.
“The board has heard from shareholders and is working on a plan to address their concerns responsibly,” an Aimia spokesperson said when asked to comment on the result.
Mithaq publicly declared its opposition to Aimia’s board just two weeks ago, citing concerns “regarding capital allocation decisions relating to acquisitions.” Aimia was quick to accuse Mithaq of pressing it to support its own investments, and a dramatic war of words ensued.
Aimia also claimed that a former member of its own management team was working with Mithaq to solicit shareholder votes against the incumbent board of directors. In a statement released Monday evening, hours before Tuesday’s AGM, the company announced it had obtained a temporary injunction against “the former chief investment officer of Aimia and its subsidiary, Mittleman Investment Management LLC.”
The court order prohibits that person from, among other things, influencing shareholder votes and divulging Aimia’s confidential information.
While not mentioned by name, Christopher Mittleman – the CEO’s brother – is the only person to ever hold the title of “chief investment officer” at Aimia, having served in that role between 2020 and 2022.
Christopher Mittleman did not respond to a request for comment, and the company did not respond to a request for confirmation of his identity.
Aimia claimed to have uncovered correspondence between “this former insider” and some of its shareholders “in which they discussed taking control of Aimia and using its significant cash position to invest in companies in which they already hold investments.”
“As part of this plan, the insider disclosed confidential information of Aimia, including a file labelled ‘privileged & confidential’ to multiple shareholders,” the Aimia statement said, adding that “one of those shareholders was Mithaq.”
Aimia has no immediate plans to replace Mr. Rosenkrantz. In fact, the company said he “will continue as chair for up to 90 days and until the conclusion of the investigation against Mithaq and its joint actors.”
Jameson Berkow