Buffett may end up Occidental’s owner-by-accident 15 Apr 2020 The Sage of Omaha struck a clever deal with the shale driller by investing $10 bln through preferred shares. Now the oil price has halved, and on paper Occidental’s regular equity may be almost worthless. The true price of Buffett’s help is becoming clear.
ValueAct slides an atypically ajar shōji 14 Apr 2020 After a victory at Olympus, the U.S. investor is trying to push open the latticed door at $4 bln JSR. Unusually for a Japanese company, the synthetic rubber and chemicals maker has a foreign CEO and regularly pays out cash. That means it could be receptive to an outsider’s ideas.
Poison pills don’t always taste so bitter 9 Apr 2020 Boards sometimes use these defenses to deflect activists or unwanted bidders. Restaurant chain Dave & Buster’s may have found a less suspect use. Its pill could help it get raider KKR to buy shares directly rather than in the market – and put cash into the company in the process.
Climate fight at Mizuho previews wider clash 9 Apr 2020 An investor group is urging the $29 bln finance giant to reduce lending for coal. With Japan in a state of coronavirus emergency, it’s an odd time to pick this battle, nor is Mizuho in charge of national energy policy – the real problem. But activists have to start somewhere.
Icahn’s Volkswagen-Navistar deal is DOA 8 Apr 2020 The activist was finally set to make a fat return on the U.S. truck maker thanks to the German carmaker’s $2.9 bln offer. But the deal was never signed, and the target’s shares have halved. Given CEO Herbert Diess may have to take state aid, another Icahn bet may bite the dust.
HSBC retail investors pick odd time for a fight 6 Apr 2020 Thousands of Hong Kongers are rallying to act against the UK bank for halting dividends. The lender has complex ties with the Asian hub, where it makes most of its profit. The city needs more grassroots activism. But at a time of profound uncertainty, the agitation lacks class.
Starboard takes no prisoners, offers no pity 3 Apr 2020 A pandemic hasn’t stopped the activist fund from going hard on companies like eBay and GCP. Other notoriously difficult investors – Elliott, Icahn – are showing restraint. Covid-19 shouldn’t be a shield for badly run businesses, but cutthroat tactics are best used sparingly.
Japanese investors stick to curious old ways 30 Mar 2020 Despite signs of displeasure with Kirin’s strategy, shareholders rejected proposals to change it. Toshiba Machine’s approved anti-takeover measures while Teikoku Sen-i’s spurned higher payouts. There are glimmers of progress in the votes, but they are self-defeating all the same.
Crisis gives activism new drive in Lagardère spat 26 Mar 2020 Amber Capital is pressing ahead with its campaign to oust the French company’s supervisory board. Long-term share underperformance and messy governance provide the justification. With Covid-19 giving companies an excuse to shelve reforms, constructive criticism is still needed.
Korean Air drama risks ending in corporate tragedy 25 Mar 2020 Feuding siblings, white knight Delta Air Lines, and a pushy activist are all battling over the country’s top carrier. Change is overdue, but debt worth 862% of equity has left Korean Air more vulnerable than peers to a pandemic. Any victory from the proxy battle will be pyrrhic.
Corona Capital: Religious aid, Ad-spending slump 23 Mar 2020 Concise views on the pandemic’s corporate and financial fallout: U.S. Vice President Mike Pence wants Americans to donate to religious institutions to bolster community aid. But churches have their own fiscal problems. Plus: TV ad revenue look set for a pounding.
SoftBank’s buyback is opportunistic and frivolous 13 Mar 2020 The Japanese group is partly bowing to pushy hedge fund Elliott by repurchasing $5 bln of its own stock. In a plunging market, though, Masayoshi Son’s company may struggle to sell assets at decent prices to fund the move. And taking on more debt will do little to boost its value.
Oxy victory would help Icahn’s poor oil-patch rep 12 Mar 2020 By raising his stake in Occidental Petroleum, the activist has upped the odds of getting his way, or reaching a truce. It helps that his demands – a new CEO and a sale of the company – both make sense. A trail of rocky energy investments means Icahn could use a high-profile win.
Prudential’s U.S. listing throws spotlight on Asia 11 Mar 2020 CEO Mike Wells plans to sell a slab of the UK insurer’s Jackson unit. It’s the second stage of a breakup, and partly satisfies activist Dan Loeb’s call for a full split. But any meaningful boost in the $37 bln company’s value depends on investors reassessing its Asian business.
Xerox drawn into duplicative Japanese fight 10 Mar 2020 After pushy investor Carl Icahn showed up, the U.S. printer maker rancorously rewrote a 57-year relationship with Japan’s Fujifilm. Xerox’s next move, a hostile $35 billion bid for HP, has now riled Canon, a 35-year HP partner. Aggressive tactics invite copycat responses.
Big Oil’s wipeout invites a new sort of activist 9 Mar 2020 Plunging crude prices have sent BP shares down 20%, with Shell and Total close behind. The rout could make it harder for oil majors to shift away from fossil fuels. Dirt-cheap valuations offer a way for activists to push CEOs to cut investment and return cash to shareholders.
Activists leave Twitter with unspoken ultimatum 9 Mar 2020 The $26 bln social network struck a deal with Elliott and Silver Lake involving board seats, fresh capital and a $2 bln share buyback. Twitter also effectively pledged to grow users by 20%. If CEO Jack Dorsey can’t deliver, he may find himself under pressure to sell the company.
Which CEO should run HP-Xerox? Both, or neither 3 Mar 2020 Bosses’ egos loom large in mergers. Yet hostile bidder Xerox’s John Visentin and HP’s Enrique Lores bring complementary skills. Rationally, HP should buy Xerox, Visentin stick around to help execute the combo, and Lores run the show. Or they should both make way for new blood.
Elliott’s Twitter DM does Jack Dorsey a favor 1 Mar 2020 The activist investor wants to remove the CEO of the $26 bln social media company as it underperforms peers. Square, the fintech outfit he also runs, is a distraction. Twitter has opportunity better navigated with fresh eyes, and Dorsey could benefit from having fewer jobs, too.
Icahn’s intrusions hurt worthwhile HP-Xerox deal 28 Feb 2020 The activist shareholder with stakes in both companies has been pushing for a merger since August, according to HP’s account of Xerox’s $35 bln hostile bid. A friendly deal still makes sense. Yet Icahn’s self-interest and influence over Xerox only make it easier for HP to say no.