Ceridian said Saturday it resolved a proxy battle with its largest shareholder, Pershing Square Capital Management, clearing the way for the payroll processing company to be acquired for about $5.2 billion.
At its Sept. 12 annual meeting, Ceridian will add four directors proposed by Pershing Square, a hedge fund led by activist investor William Ackman, increasing the size of its board to 11 members from seven. Pershing Square will discontinue its proxy contest.
Kathryn Marinello, Ceridian's chief executive, said in a statement the resolution allows the company to move forward with its $36 per share all-cash buyout by private equity firm Thomas H. Lee Partners and title insurer Fidelity National Financial.
Ackman said in a statement: "We are delighted to have brought this situation to an amicable conclusion, and look forward to a prompt closing of the merger." Pershing Square owns about 14.9 percent of Ceridian's shares.
Ceridian said it would appoint three of Pershing Square's nominees -- John Barfitt, Robert Levenson and Gregory Pratt -- as well as Pershing Square's Paul Hilal, to the board.
The Minneapolis-based company had agreed on May 30 to the $36 per share buyout, a 17 percent premium to its closing price on Feb. 12, the last trading day before it said it was exploring strategic alternatives.
Ackman had been pushing Ceridian to spin off its Comdata division and replace its board. He at first opposed the buyout, but threw his support behind it on Aug. 14 after deteriorating credit market conditions ended any realistic prospect that Ceridian could fetch a higher competing bid.
Nonetheless, Ackman kept pushing to replace Ceridian's board with his slate of seven director candidates. One proxy advisory service urged shareholders to ignore Ackman. A second supported just two Ackman candidates and urged shareholders to withhold votes from Ceridian's.
Representatives for Ceridian and Pershing Square did not immediately return calls seeking further comment.
Ackman gained prominence in 2005 and 2006 with successful campaigns to implement changes at McDonald's and to push Wendy's International to spin off its Tim Hortons chain. In July, he disclosed a 9.6 percent stake in discount retailer Target .
Ceridian shares closed Friday at $34.80 on the New York Stock Exchange. The company had about 144.2 million shares outstanding as of July 31, a regulatory filing shows.