Align Technology, the manufacturer of Invisalign clear aligners, has reached a settlement with activist hedge fund Elliott Investment Management that will see three new independent directors added to its board, according to a report by Bloomberg.
The company has also agreed to a broader review of the its strategy and governance.
The agreement follows months of engagement between the two parties after Elliott built a substantial holding in the dental technology company, becoming one of its largest shareholders earlier this year.
As part of the settlement, Align will begin a comprehensive review of its strategic direction and operating model to support future growth. The company has also expanded its share repurchase programme, increasing its planned buybacks this year to between $400m and $500m.
Align chairman Kevin Conroy said the company valued its discussions with Elliott and remained focused on executing its long-term strategic priorities.
The company has not yet named the three incoming directors but said it will seek candidates with expertise spanning healthcare technology, medical devices, global operations, consumer technology, innovation and scaling high-growth businesses.
Marc Steinberg, a partner at Elliott, welcomed the measures, describing the governance changes and strategic review as important steps. He said the hedge fund’s sizeable investment reflects its confidence in Align’s long-term growth prospects.
The announcement came as Align reported second-quarter financial results. Revenue for the three months to 30 June rose 4.3% year-on-year, while net income declined 13%. Shares gained 2.6% in after-hours trading following the updates.
Align’s shares remain well below their pandemic-era peak, having fallen sharply since reaching record highs in 2021, when demand for cosmetic dental treatments surged. The Tempe, Arizona-based company has supplied more than 22 million patients with its clear aligner products since its founding in 1997.
