By David Benoit 

Ralph Nader, the longtime consumer advocate, is opening a new front in his corporate-reform crusade.

Mr. Nader, who grabbed headlines last week when he came out against Liberty Media Corp.'s takeover bid for Sirius XM Holdings Inc., said in an interview that he's seeking to put together a shareholder-activism group. As part of that effort, the 79-year-old has pledged 1% of his financial net worth, or roughly $50,000, in each of the next three years if a group of 15 to 20 others will join him to raise a total of about $10 million. He proposes to create a group he calls the Penny Brigade--shareholders would pledge one penny per share of stock they own--to raise an army of 500 people who would push companies to increase their dividends, rein in executive compensation and give shareholders a greater say in other governance decisions.

Mr. Nader says the idea for the group was born after he successfully pushed Cisco Systems Inc. to boost its dividend in 2012.

And he has now entered into the mergers-and-acquisitions game, threatening legal action over a bid from Liberty Media for the roughly 48% of Sirius XM Holdings it doesn't already own, an offer he says is too low.

Mr. Nader called the offer, valued at about $3.68 a share, "ludicrous" and added: " Carl Icahn--take notice and interest." Mr. Icahn, the 1980s corporate raider, has also reinvented himself as a shareholder activist, and he has successfully challenged a host of companies in recent years.

Mr. Nader says he bought Sirius shares more than four years ago, when the company was struggling and before Liberty Media stepped in with a loan to keep it afloat. Mr. Nader credits Liberty Media with saving Sirius, but believes shareholders deserve more in the proposed deal. This week he sent a letter to top Sirius shareholders asking for support.

Liberty Media said in a statement that the all-stock offer allows shareholders to "continue to participate in the success of the Sirius business" and noted it was confident shareholders "will see the significant benefits." Sirius declined to comment.

While many institutional shareholders have become more vocal in recent years, Mr. Nader believes they still haven't gone far enough in asserting their rights. Launching into a detailed history of corporations in America, he said that companies today have "more and more power and less and less responsibility."

Whether Mr. Nader, who is credited with helping make cars safer and being an early environmental activist, succeeds in his latest quest remains an open question. A similar group started in 1986 by former corporate raider T. Boone Pickens, the United Shareholders Association, claimed 65,000 members. Run by Ralph Whitworth, now a prominent investor activist himself, the organization disbanded in 1993 saying it had achieved its goal of boosting shareholder rights.

A study in the Journal of Financial Economics in 1996 said the United Shareholders Association succeeded in improving governance and boosting shareholder wealth, reaching more than 50 settlements with companies. The study credited the group with working productively with institutional shareholders.

Some question if Mr. Nader, a five-time presidential candidate, is the best person to form the successor to that alliance.

"I don't think that he has credibility to the institutional investor community," said John C. Coffee, a professor at Columbia University and shareholder-activism expert.

Mr. Nader says that is why he's seeking help from old friends like Robert Monks, a former official in the Reagan administration and founder of influential investor-advisory firm Institutional Shareholder Services Inc. Mr. Nader also says he'll look to stay in the background of his new venture.

Mr. Monks, who was a classmate of Mr. Nader's at Harvard Law School, said he is encouraged Mr. Nader is focusing on shareholder advocacy.

"There is an absence of leadership," Mr. Monks said.

Arthur Levitt, the former chairman of the Securities and Exchange Commission, said he would be inclined to support such an organization, but he said he needs more details from Mr. Nader and cautioned that there "is a line between shareholder activist and interference with management."

Mr. Nader said the financial crisis is evidence that boards don't deserve deference.

"Look at your own history and stop bragging," he said. "It's just like thinking factory workers have nothing to put in the suggestion box about making the factory hum better."

Write to David Benoit at david.benoit@wsj.com

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