Elliott Management is on a tear in the new age of the activist investor
Hedge fund Elliott Management is on a roll, reflecting the rise in activity among activist investors this year.
Today oil and gas firm Hess announced a compromise with Elliott, which had been pushing for five nominees to gain seats on Hess’s board. Bloomberg also reported today that Elliott has taken a stake in data storage firm NetApp, seeking to force the company to make changes to its board and return more cash to shareholders. NetApp shares were up by more than 6% on the news.
Hess was facing the possibility of losing a vote today on its director nominees in favor of Elliott’s slate. As part of the agreement, Elliott will back Hess’s five director nominees, while Hess agreed to three people on Elliott’s list. That put an end to a fierce fight that had both sides making last minute concessions to win over shareholders. John Pike, a senior portfolio manager at Elliott, said he welcomed Hess’s “refreshed board.”
Elliott also pushed for the sale of BMC Software, which had long been seen as an attractive takeover target. Earlier this month, private equity firms Bain Capital and Golden Gate Capital led the buyout of BMC for nearly $7 billion. Elliott portfolio manager Jesse Cohn was quoted in the BMC press release about the sale, which is notable because other companies that are the target of activists don’t always acknowledge them. Cohn was also quoted in an April press release for telecommunications hardware and software maker Emulex, which took on two board directors supported by Elliott.
In January, Elliott made an offer to acquire software firm Compuware, which the company rejected. But Compuware is now exploring a sale, which will still benefit Elliott, since it’s a large shareholder in the firm.
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