Activist zealots, not much to report today. Our meager offering of activist new and stories is below. Taking tip at @activiststocks or email, and sign up for our daily newsletter.
- Steel Partners has sold off enough Nathan’s Famous shares to get its stake to just below 5%, now at 4.98%.
- Carl Icahn ups his Federal Mogul stake by 14% to 138.5M shares, now owning right at 82%.
- Stewart Information Services settled with Bulldog Investors (Engine Capital and Foundational Asset Mgmt are also active here), where it agreed to nominate an independent director and “consider” restructuring its dual class structure. This could go either way for Bulldog, as the issue at Stewart is “Class B shareholders own 5% of the company but have enough of the shareholder vote to elect four of the nine directors” [link for quote h/t @stockpucker]
- Trian Partners apparently got a call from one of DuPont’s largest shareholder earlier this month. Fidelity called to ask the fund to compromise with DuPont, in hopes of avoiding what could be a costly proxy battle.
GrizzlyRock Value Partners was up 16.6% for the first quarter, compared to the S&P 500's 5.77% gain and the Russell 2000's 12.44% return. GrizzlyRock's long return was 22.3% gross, while its short return was -2.9% gross. Compared to the Russell 2000, the fund's long portfolio delivered alpha of 10.8%, while its short portfolio delivered alpha Read More
- @EthicalBoard has a piece by Columbia Law Prof, John Coffee. In it, he focuses on what he calls the “darker side of activism.” I get Coffee’s thesis, where there’s two instances where activism is bad, one – trying to break up an otherwise profitable and outperforming company, and two – focusing a company to scale back on long-term investments, such as R&D, which could hamper long-term growth. But I think he could have put in a bit more effort to source better examples, where he uses Trian/Dupont as his “why break up a profitable company” example, and Ackman/Valeant for his “why force a company to scale back value-creating investments” example [link]
- @OctavioCNN puts a piece together for CNN Money detailing how a religious order the running activist campaigns at for-profit prisons. Mercy Investment Services is an investment fund for the Institutes of Sisters of Mercy of the Americas and it’s now running an activist strategy. It’s buying shares in for-profit prisons and pushing for change in how they are ran. Nuns are the new breed of activist investors [link]