July 29 (Reuters) – Align Technology will add three new independent directors to its board and launch a review of its operations following talks with activist investor Elliott Investment Management, the company said on Wednesday.
Shares of the medical device maker were down 4.5% in extended trading.
The three new board members, who have not yet been named, will be chosen for their expertise in healthcare technology, medical devices, global operations, and scaling high-growth businesses.
Elliott, one of Wall Street’s most prominent activist investors, has increasingly turned its attention to healthcare companies over the past year, often pushing for board representation and strategic reviews to boost performance.
Elliott’s recent targets in the sector have included Dexcom, Medtronic and Charles River Laboratories.
Align has hired a leading global consulting firm to conduct a comprehensive review of its operations and business model. The company said the review will focus on improving revenue growth and boosting profit margins.
The changes follow discussions with Elliott, which has emerged as one of Align’s largest shareholders.
Align manufactures dental retainers, scanners and software for dental laboratories and practitioners, and is widely regarded as a leader in the dental technology market alongside peers such as Envista, Dentsply Sirona and Henry Schein.
Align rose to prominence as the maker of Invisalign, the clear dental aligner system that disrupted traditional braces and helped transform orthodontics through digital scanning and treatment planning.
Marc Steinberg, a partner at Elliott, in a statement called Align a market leader with significant growth potential. “We believe the board enhancements and other actions…are important steps toward delivering on this opportunity,” he said.
The company said it raised its share buyback target for the year to between $400 million and $500 million, up from $200 million, citing confidence in its long-term value.
(Reporting by Padmanabhan Ananthan in Bengaluru; Editing by Sahal Muhammed and Shailesh Kuber)
