Starboard presses on with push to replace Depomed's board

Starboard Value says it is pressing ahead with its boardroom coup attempt at Depomed even though the pain treatment maker backed off a reincorporation plan that incensed the activist investor.

Depomed said late Thursday that it decided not to pursue a proposed reincorporation to Delaware from California because it would lead to "a costly and distracting proxy contest" while the company tries to grow.

Starboard says the reincorporation plan was designed to entrench the board, and the drugmaker was disingenuous in stating that it withdrew the proposal to avoid a proxy fight.

Starboard Value LP holds a nearly 10 percent stake in Depomed and has said it wants to replace the drugmaker's board. It has accused current board members of being more concerned with enriching themselves than improving shareholder value.