UPDATE 1-EXCLUSIVE-Microsoft in talks with ValueAct over board seat -sources
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NEW YORK/SEATTLE, July 19 (Reuters) - Members of Microsoft Corp's board have held talks with ValueAct Capital Management LP in recent days over the activist shareholder's demands to secure a seat on the company's board, two sources close to the matter said.
ValueAct, which wants a say in the way the world's largest software company is adapting to the new world of mobile computing, is seeking to nominate a person from its own organization, the sources said.
The San Francisco-based fund, which manages more than $10 billion for clients, owned 33 million Microsoft shares as of March, which is 0.4 percent of total shares outstanding, but it is believed to be buying more.
In recent months a number of Microsoft's top institutional investors have contacted ValueAct, expressing concern over management execution and strategy, the sources said.
High among the issues in the talks, which the sources described as ongoing, is the apparent lack of succession planning at the top of the company. Steve Ballmer has held the chief executive job since 2000 and shows no signs of relinquishing it.
Ballmer, 57, once remarked that he envisaged staying on until his youngest child goes to college, which would be around 2017 or 2018, but since then he has not publicly addressed the matter.
ValueAct declined to comment. Microsoft did not immediately respond to a request for comment. The software company has said there is a CEO succession plan in place, but declined to give details of it.
(Reporting by Bill Rigby; Editing by Edward Tobin, Gary Hill)