The move by activist hedge fund the Clinton Group to try to oust senior executives at ValueVision Media, the Internet and shopping network, is poised to become a bitter battle.
The Clinton Group is expected to send a letter to ValueVision’s board on Wednesday, accusing it of “surreptitiously†seeking to push off a special meeting for shareholders to consider the hedge fund’s proposal to replace five board members. It is also calling for the chief executive to step down.
Earlier this week, the hedge fund announced it had joined forces with Cannell Capital, another hedge fund, to mount a proxy battle for control of the company. Together the two funds have more than 10 percent of outstanding shares in the company. The Clinton Group filed a request demanding a special meeting for shareholders in a document filed to the Securities and Exchange Commission on Monday.
For years ValueVision, which sells jewelry, watches and appliances, has underperformed its competitors the Home Shopping Network and QVC. The Clinton Group contends the business is in need of a makeover.
It is calling for Randy S. Ronning, the chairman of ValueVision, and Keith R. Stewart, the current chief executive, to step down and has proposed a list of candidates for new board members that includes Thomas D. Mottola, the former chairman and chief executive of Sony Music Entertainment, and Thomas D. Beers, the chief executive of “American Idol†producer FremantleMedia.
In a response on Tuesday, Mr. Ronning asked the activist hedge fund to hold off on its campaign to shake up the business until after the end of the holiday season so that executives can remain “laser focused†during the holidays.
“The board is receptive to listening and considering the views of our shareholders, and we are also receptive to the notion of adding qualified independent directors to our board with appropriate expertise in areas that would complement the strengths of our current board member,†Mr. Ronning, the chairman,  wrote in the letter.
But, he added: “We respectfully ask that you withdraw your request for a special meeting until after the end of the holiday season so that our management can devote its full energy to running the company at this important time.â€
In a new letter to the board on Wednesday, the Clinton Group will accuse Mr. Ronning of misleading shareholders by asking the hedge fund to withdraw its special request and file a new one in February. This would give the board until May to hold a meeting.
According to Minnesota law - which requires a company to hold a meeting within 90 days of a request for special meeting - ValueVision currently has until the end of January to hold a special meeting for shareholders.
