Proxy Advisor Fuels Revolt in STAAR Surgical Takeover Battle

NEW YORK, NY – December 12, 2025 – The contentious battle for control of STAAR Surgical Company (NASDAQ: STAA) has reached a fever pitch, as leading proxy advisory firm Glass, Lewis & Co. has reaffirmed its recommendation for shareholders to vote “AGAINST” the proposed acquisition by eye care giant Alcon Inc. (NYSE: ALC). This move significantly bolsters the position of activist investor Broadwood Partners, L.P., which has been waging a relentless campaign against what it calls a “misbegotten transaction” plagued by a flawed process and an inadequate price tag.

The recommendation from Glass Lewis, a firm whose opinions carry substantial weight with institutional investors, delivered a sharp rebuke to the STAAR board. It sets the stage for a dramatic shareholder vote on December 19, which will determine the fate of the medical device innovator and could serve as a landmark case in shareholder activism and corporate governance.

A Crisis of Credibility

At the heart of the opposition is a profound lack of trust in the STAAR board’s handling of the sale process. In its scathing report, Glass Lewis stated, “we do not believe there exists persuasive cause for investors to endorse the revised Alcon arrangement.” The firm’s assessment paints a picture of a board more committed to finalizing a deal with a preferred suitor than to securing maximum value for its shareholders.

Glass Lewis pointedly criticized the board's procedural integrity, noting that its credibility was “remarkably threadbare.” The advisory firm highlighted the board’s initial staunch defense of Alcon’s original $28.00 per share offer, which it had claimed “maximizes value for STAAR shareholders,” only to abandon that position under pressure from investors. The report observed, “The timing and cadence of STAAR's postponements appear emblematic of a board committed to preserving the executed agreement with Alcon rather than simply acknowledging what appears to have been exceptionally clear feedback from the Company's investors.”

Adding to the governance concerns is the rare unanimity among all three major proxy advisory firms. Institutional Shareholder Services (ISS) and Egan-Jones have joined Glass Lewis in recommending a vote against the merger. Such a consensus is unusual and sends a powerful signal to the investment community that the deal’s structural and financial foundations are deeply flawed. Broadwood has seized on this, alleging that the board, led by Chair Dr. Elizabeth Yeu and CEO Stephen Farrell, failed to disclose inbound acquisition interest to other directors and to shareholders, further eroding its credibility.

The Price is Wrong: A Flawed Process and Inadequate Offer

While Alcon increased its offer to $30.75 per share in a “best and final” bid following a 30-day “go-shop” period, critics argue the improved price still fails to capture STAAR’s intrinsic value. The go-shop process itself, designed to solicit superior proposals, has been decried by opponents as “performative” and structurally biased in Alcon’s favor.

Glass Lewis noted significant procedural deterrents for potential rival bidders. According to the firm, “the structural advantages afforded to Alcon remain evident.” While go-shop participants were asked to sign a standard non-disclosure agreement (NDA) that reportedly included a multi-year standstill provision, Alcon’s original NDA explicitly excluded such a clause. This disparity, coupled with Alcon’s right to be informed of and potentially top any competing bid, likely chilled interest from other serious acquirers.

Financially, the revised offer continues to fall short in the eyes of its detractors. Glass Lewis calculated that the new price implies a next-twelve-months (NTM) revenue multiple of approximately 4.6x, which “does not depart meaningfully from the multiple implied by the original agreement.” This valuation “continues to track well below the Company's unaffected three- and five-year stand-alone multiples” of 5.6x and 10.7x, respectively. The analysis suggests that the board agreed to a deal at a valuation trough, failing to account for peer multiple expansion and STAAR’s own potential for a standalone rerating in the market.

Activism in Action: Broadwood's Campaign Intensifies

Spearheading the opposition is Broadwood Partners, a New York-based investment firm holding a 30.2% stake in STAAR. Led by founder Neal C. Brasher, Broadwood has launched a sophisticated public campaign, complete with a dedicated website, to rally fellow shareholders to vote “AGAINST” the deal.

In a statement, Brasher praised the Glass Lewis report, asserting that it “correctly concluded that the revised price is not compelling and that the STAAR Board lacks credibility.” He further condemned the go-shop process, stating it “could not, in any event, be trusted because it was being run by the same conflicted Board, executives, lawyers, and bankers who negotiated the deeply flawed deal with Alcon in the first place.”

Broadwood’s strategy is twofold. The immediate goal is to defeat the Alcon merger at the upcoming special meeting. Concurrently, the firm has signaled its intent to call a separate shareholder meeting to remove three key board members: CEO Stephen Farrell, Board Chair Elizabeth Yeu, and Compensation Committee Chair Arthur Butcher. Broadwood argues that a refreshed board is necessary to conduct a “full, fair, independent, and open strategic alternatives process” and restore shareholder trust. This move demonstrates the escalating power of activist investors to not only influence M&A outcomes but also directly challenge and reshape corporate leadership.

A Company at a Crossroads

With the shareholder vote just days away, STAAR Surgical is at a critical inflection point. A vote in favor of the acquisition would provide shareholders with a certain cash payout at a significant premium to the stock’s pre-announcement price. Alcon has argued that STAAR lacks the scale and resources to thrive as a standalone entity and that the alternative is an “uncertain future” under the influence of an activist investor.

However, a rejection of the deal would open up several alternative paths, each with its own set of opportunities and risks. As a standalone company, STAAR could focus on its innovative product pipeline, particularly its EVO family of Implantable Collamer® Lenses (ICLs), which are gaining traction globally as a compelling alternative to laser vision correction. With approvals for next-generation lenses anticipated in key markets like China, management has projected a significant operational turnaround. A failed deal, followed by a successful board overhaul led by Broadwood, could trigger a new, more transparent sale process designed to attract a wider range of bidders and potentially a much higher price. The risk, as some analysts note, is that the stock could fall significantly without the floor of Alcon’s offer, and there is no guarantee a superior proposal would materialize. For STAAR’s investors, the decision is a complex calculus of certain value now versus the uncertain, but potentially greater, promise of tomorrow.