NEW YORK, Sept 19 (Reuters) - Masimo Corp ( MASI )

shareholders elected both director candidates proposed by

veteran activist investor Quentin Koffey's hedge fund Politan

Capital Management, in one of the most contentious boardroom

battles of the year.

Investors took the highly unusual step of ousting the

company's CEO - Joe Kiani who founded Masimo ( MASI ) in 1989 - from the

board while also handing an additional two seats to Politan

which already won two seats in 2023, the company said on

Thursday.

Bill Jellison and Darlene Solomon were elected to the board

of the medical devices maker known for producing oximeters.

Masimo ( MASI ) is currently valued at $6 billion after its stock price

dropped roughly 60% in the last three years.

Kiani said in the past that he would quit as CEO and sell

his shares valued at roughly $500 million if investors replaced

him on the board with a Politan nominee. Politan has previously

proposed that Kiani could keep his job as CEO and return to the

board even if shareholders vote him out.

Politan returned for a second proxy fight this year after

having already won two seats, including one for Koffey, at last

year's meeting. But since then, the hedge fund argued that more

change is needed.

The biggest proxy advisory firms Institutional Shareholder

Services and Glass Lewis recommended electing Politan's

nominees, with ISS writing that Kiani "wants to have his cake

and eat it too" by enjoying the benefits of being a public

company but running it like a private business.

The drama included a raft of lawsuits filed by Masimo ( MASI ) and

Politan. The shareholder meeting was moved to September from

July.