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MeadWestvaco Moving On Hedge Fund Activity

Luke Jacobi

MeadWestvaco (NYSE: MWV) shares are up almost five percent Monday after activist fund Starboard showed a 5.6 percent stake in the company.

Starboard is urging better governance from MeadWestvaco and has several other suggestions. These include spinning off the specialty chemical business, monetizing real estate and engaging in a $500 million buyback (the company announced earlier this year that it completed a 0 million buyback). These comments were included in the company's 13D filing.

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MeadWestvaco responded hours later, claiming the board will consider Starboard’s suggestion. The letter further commented on the board’s performance: "Over the last five years, MWV has delivered 247.3% total shareholder return versus 132.6% for the S&P 500. Year-to-date returns have been 14.6% for MWV compared to 5.0% for the S&P 500.”

Unlike the letter from Starboard, MeadWestvaco’s statement did not move shares. The issue was last trading at $42.54, up 4.83 percent.

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