13D MONITOR ACTIVIST MEDIA CENTER
Breaking news and more: Your media center for shareholder activism and corporate governance.
Starboard Value LP on Thursday officially requested a special shareholder meeting to revamp the board at Depomed Inc. (DEPO). In a letter, the investor presented a slate of six director nominees—including its CEO, Jeffrey Smith. “We believe that Depomed is deeply undervalued and significant opportunities exist within the control of management and the board of directors to unlock substantial value,” Starboard wrote. The drugmaker reacted with surprise, considering that it made changes to its bylaws last month in order to empower the investor to call a special meeting. “We are therefore surprised by Starboard's announcement this morning that they not only want to restart the process to call a special meeting, but that they also want to go through a public solicitation to call a special meeting,” Depomed said in a statement. The company added that it would consider Starboard's new requests “in due course.” Starboard, which owns a 9.9% stake in the firm, has argued that the value of Depomed's shares could rise with improved capital deployment, rationalized research and development, and a potential sale. The special shareholder meeting could occur between June 1 and July 25.
Abstract News © Copyright 2016 INFORMATION, INC.
William Ackman, Valeant Investor, Tries Life as an Inside Man
" Wall Street Journal (05/26/16) McNish, Jacquie; Benoit, David"
After firing Valeant Pharmaceuticals International Inc. (VRX) CEO Michael Pearson and joining the board in March, William Ackman—known for pushing change at companies—finds himself on the other end, defending the embattled drug company from attacks on all sides. In his first few months as an insider, he secured backing from banks to avert defaults on Valeant's bank debts and courted a new CEO, Joseph Papa; he and the board also rebuffed an overture from Japanese drug maker Takeda Pharmaceutical Co. and private-equity firm TPG. Early investor feedback looked good: shares rose 7% after Valeant announced Pearson was leaving and Ackman was joining the board, then 15% over the next two days. The stock rose another 8% after reports of hiring Papa. Since then, however, the outlook has changed; and Valeant shares have returned to about the same price when he joined the board.
Homegrown Hedge Fund Activism Takes Root in Europe
" Financial Times (05/23/16) Fortado, Lindsay"
Homegrown hedge fund activism is steadily growing in Europe. For European funds—or U.S. funds with European operations—it has been more about engagement than U.S.-style confrontation, and observers say it may be producing better results. Those activist hedge funds succeeding in Europe have tended to follow the less brash model adopted by Sweden's Cevian Capital: quietly building up significant stakes in public companies and engaging with their management and board members behind the scenes, before taking their demands public. So far this year, these funds are outperforming their U.S. counterparts: on average, European activist funds have returned 7.6% in the year to date, while U.S.-based funds managed only 0.5%, according to eVestment. Fund managers argue that the continent is rife with undervalued companies, and that company managements appear generally receptive to having a dialogue with more shareholders willing to support their demands. In addition to the big names of European activism—Sir Chris Hohn's TCI hedge fund in London, London-based Amber Capital, Cevian and Knight Vinke—there are now some new players from the United States. Elliott and Southeastern Asset Management have steadily built up substantial practices in London, while ValueAct won a board seat at Rolls-Royce.
Abstract News © Copyright 2016 INFORMATION, INC.
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This month’s Activist Report:
||Misunderstood activist investors?
Source: CNBC Video - May 19, 2016
||Betting on Zero: Bill Ackman vs. Herbalife
Source: CNBC Video - April 15, 2016
||No Joy for Hedge Funds in 2015
Source: Bloomberg TV - December 23, 2015
||Does Ackman's Valeant Call Tarnish His Reputation?
Source: Bloomberg TV - October 30, 2015
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