T O P A C T I V I S T S TO R I E S   A REVIEW OF FINANCIAL ACTIVISM BY GENEVA                         PARTNERS            ...
T O P A C T I V I S T S TO R I E S   A REVIEW OF FINANCIAL ACTIVISM BY GENEVA                         PARTNERS            ...
Appetizing Changes at Wendysby David Englander                             of the stores are in the U.S., with the        ...
Activists keep tech sector on its toes By Dan McCrum and Richard Waters                2008, when he forced Larry Ellison,...
Icahns 13% Stake in Herbalife Presents Contrast With AckmanBy Duane D. Stanford and Miles Weiss            assertion that ...
Peltz Helped Spur Heinz Turnaround Setting Stage for BidBy Miles Weiss                                 Hathaway and Jorge ...
At the same time, much of the                data compiled by Bloomberg.                    according to filings, and, bet...
This newsletter has been prepared by, and is subject to the copyright of, Geneva Partners S.A. (Geneva Partners).This news...
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  1. 1. T O P A C T I V I S T S TO R I E S A REVIEW OF FINANCIAL ACTIVISM BY GENEVA PARTNERS February 15th,2013 PLEASE SCROLL DOWN FOR ARTICLES Knight Vinke Patience Snaps as Darty Profit to Miss Estimates Darty Plc’s largest investor plans to exercise its right to install a representative on the board of France’s biggest electronics retailer, losing patience after the company warned that annual profit is set to miss estimates. […] Appetizing Changes at Wendys Through his firm, Trian Fund Management, Peltz and associates control 27% of Wendys stock. Peltz, who has been a director of the company since 1993, currently serves as chairman, and has long made his view known that Wendys is worth far more than its stock-market value. […] Activists keep tech sector on its toes Mr Einhorn is going after Apple, where he is trying to persuade the iPhone maker to set aside more of its $137bn cash pile for investors. The record suggests that the tech world has been highly receptive to the urgings of activists. Icahns 13% Stake in Herbalife Presents Contrast With Ackman It turns out billionaire investor Carl Icahn really is bullish on Herbalife Ltd., a position in sharp contrast to rival hedge-fund manager Bill Ackman.[…] Peltz Helped Spur Heinz Turnaround Setting Stage for Bid Nelson Peltz may warrant thanks from H.J. Heinz Co. stakeholders after Berkshire Hathaway Inc. and 3G Capital’s offer to buy the ketchup maker for about $23 billion, even though the billionaire hedge-fund manager won’t share much in the reward.[…] Lear shares rise as hedge fund seeks board seats Marcato Capital Management reported a 5.2 percent stake in auto parts maker Lear Corp and the hedge fund said it planned to nominate candidates to the board, sending its shares higher in early trading. […] 1GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  2. 2. T O P A C T I V I S T S TO R I E S A REVIEW OF FINANCIAL ACTIVISM BY GENEVA PARTNERS February 15th,2013 Knight Vinke Patience Snaps as Darty Profit to Miss EstimatesBy Sarah Shannon and leaseback of property, and for all ease the profit decline.February 15th, 2013 staff to have the opportunity to Gross margins, a measure of become shareholders. profitability, narrowed by 1.1 percentage point in the third quarter, Darty Plc’s largest investor plans to Shares Slump Darty said today.exercise its right to install a “We can’t expect any materialrepresentative on the board of Darty shares fell as much as 16 improvement in the coming year and IFrance’s biggest electronics retailer, percent today, the most in more than think there will continue to belosing patience after the company four years, after the retailer said it will pressures,” acting Chief Executivewarned that annual profit is set to probably miss profit estimates for the Officer Dominic Platt said on amiss estimates. year ending April 30. Sales “softened” conference call. “The consumer isKnight Vinke Asset Management LLC, at the end of the third quarter, while tightening its belt in difficultwhich owns 25 percent of the stock, high levels of promotional activity are circumstances and respondingsaid it will take the action after harming profitability, it said. perhaps more to promotional activityDarty’s failure to implement all the Adjusted pretax profit is unlikely to and I think that will continue in thestrategic changes it recommended in reach the lower end of analyst short term.”July. estimates of about 30 million euros, it The executive said that while“We fail to note any increased sense said. November was “tough,” the run-upof urgency in its deliberations, despite “Overall this is a weak update from and through Christmas was good witha deterioration in the trading Darty given softening market trends strong sales of multimedia items suchenvironment that was not at the end of the period,” Georgina as tablet devices, which “gave usunexpected,” David Trenchard, vice Johanan, an analyst at JPMorgan some hope that things were going tochairman of Knight Vinke, said today Cazenove who has an underweight be in line with expectations.”in an e-mailed statement. recommendation on the stock, said inKnight Vinke has an eight-point plan a report. “Given the magnitude of the French Economyfor Darty which it has discussed with potential downgrade, maintenance ofthe board. While most of it has been a flat full-year dividend is looking “What we’ve seen at the end ofimplemented, including the increasingly less likely.” that peak season, people areappointment of a new CEO and The retailer said in December that returning perhaps to type, thechairman, a name change, a 20 subject to performance it intended to economy in France isn’t getting anymillion-euro ($27 million) cost-savings maintain its dividend for the full year. better, and people are respondinggoal and the appointment of Goldman The total dividend for the previous more to promotions,” he said.Sachs Group Inc. as advisers, the year was 3.5 cents a share. Sales at stores open at least a year fellactivist investor has also asked it to Darty shares fell as much as 8 pence 0.5 percent, following a 3.4 percenteliminate money-losing businesses, to 41.75 pence, the biggest intraday decline in the second quarter. Sales inwhich the board says it plans to do. drop since October 2008. The stock France gained 0.4 percent on theBy taking a board seat, Knight Vinke is was down 6 percent at 46.75 pence as same basis, compared with the prioraiming to “speed up the process,” of 12 p.m., giving the company a quarter’s 3.2 percent decline.said Kate Calvert, a retail analyst at market value of about 246 million The company announced this monthCantor Fitzgerald. “Sometimes pounds. that Regis Schultz, the formernegotiations to get rid of businesses manager of French furniture andcan take longer than expected. We’ve Unprofitable Businesses electronics retailer BUT SA, is takingalways felt restructuring would create over as CEO in May.shareholder value, it’s just how The retailer has vowed to eliminatequickly.” losses in unprofitable businesses inKnight Vinke is also calling for a share Spain, the Czech Republic andrepurchase funded by a partial sale Slovakia and has sold its Italian unit to Source : Bloomberg 2GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  3. 3. Appetizing Changes at Wendysby David Englander of the stores are in the U.S., with the another part of its strategy. While theFebruary 9th, 2013 greatest concentrations in Florida, company has updated some stores Ohio, Texas, and Georgia. over the years, the latest effortsWendys is revamping its menu, In 2008, Wendys was acquired for involve an all-encompassing overhaulmarketing, and stores, and better $2.4 billion by Triarc, a holding aimed at creating a cutting-edgeresults could boost its shares by 40%. company controlled by activist design that rivals competitors. The investor Nelson Peltz. He merged it remodels include such features as A major transformation is under with Arbys and renamed it lounge seating, fireplaces, flat-screenway at Wendy s, the worlds third- Wendys/Arbys. Arbys was sold to a TVs, Wi-Fi, and digital menu boards.largest burger chain. The company private-equity group in 2011, enabling Wendys has launched 66 newstruggled for years after the death of management to focus on Wendys. restaurants, of which 48 have beenits famous founder, Dave Thomas, in The current CEO, Emil Brolick, joined remodels, and they have met with a2002, but finally looks to be finding its Wendys in September 2011 and positive response from customers.way. knows it well, having worked closely Sales in the newer-looking stores areIn the past 18 months, Wendys with Thomas in the 1990s before up 25% since remodeling. The(ticker: WEN) has gone back to its leaving for Yum! Brands. Brolick company plans to remodel 200 storesroots as a high-quality burger maker, turned around Yums Taco Bell unit, this year, and open 120 new units. Inintroducing new menu items and and most recently served as chief 2015 it is targeting 1,300 new andmore focused marketing, and rolling operating officer of Yum. Last April he remodeled outposts.out a dramatic remodeling of its hired Craig Bahner, a Procter & The changes are showing up instores. Even a new logo will be Gamble (PG) veteran, as chief profitability and sales. In theunveiled in March. marketing officer. December quarter, company-runThe results are notable, with same- Wendys earned $64 million, or 16 restaurants enjoyed profit margins ofstore sales rising for six of the past cents a share, last year, on revenue of 15.9%, compared with 15% a yearseven quarters. They were up 4.9% in $2.5 billion. This year analysts expect ago, and thats despite rising costs forthe past two years. earnings to rise to 18 cents, on a 4% beef and chicken. This yearInvestors have bid up Wendys shares rise in sales. management expects even betterby 20% from an October low, but a Wendys has made significant changes performance, with same-store salesrecent price of $5.03 puts the stock to its menu and marketing plan. rising 2% to 3%.right back where it traded around the Dubbed "A Cut Above," the latter Wendys has a solid balance sheet,start of the year. Dont expect it to emphasizes the brands high-quality giving it ample flexibility to execute itsstay there, however, as the company burgers and fresh ingredients. Since strategy. Cash stands at $454 millionbegins to churn out appetizing results. introducing its Daves Hot N Juicy to debt of $1.46 billion, making netWendys sports an enterprise value cheeseburgers in September 2011, debt 29% of total capitalization. The(market value plus net debt) of 8.4 the company has followed up with a company also generates free cashtimes this years expected Ebitda, or slew of new premium products, flow, with $15 million expected inearnings before interest, taxes, including the Bacon Portabella Melt, 2013.depreciation, and amortization. That Mozzarella Chicken Supreme, Spicy Through his firm, Trian Fundcompares with EV/Ebitda ratios of 10 Guacamole Chicken Club, and the Management, Peltz and associatesor more for fast-food competitors Berry Almond Chicken Salad. control 27% of Wendys stock. Peltz,such as McDonalds (MCD) and Yum! The new products have met with who has been a director of theBrands (YUM). The discount is likely to success, and Wendys has gained company since 1993, currently servesnarrow as Wendys transformation share in large hamburgers and large as chairman, and has long made hisunfolds, leading to a 40% jump in the chicken sandwiches. But some price- view known that Wendys is worth farstock price. conscious customers have taken their more than its stock-market value.At 10 times 2014 estimated Ebitda, business elsewhere. Management Given his involvement, a sale of theWendys would be worth $7.20. The recently launched a value-based business is a strong possibility. Onestock yields 3.2%. menu, called "Right Price Right Size," logical buyer: Yum! Brands, whichFounded 44 years ago by Thomas, and will ramp up marketing of it this doesnt own a burger business.Columbus, Ohio-based Wendys has year. Management couldnt be6,560 stores, with 78% franchised and reached for comment.the rest company-owned. Almost 90% Remodeling Wendys aging stores is Source : Barron’s 3GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  4. 4. Activists keep tech sector on its toes By Dan McCrum and Richard Waters 2008, when he forced Larry Ellison, campaign that questioned the February 14th, 2013 head of software group Oracle, to veracity of the chief executive’s CV, raise its offer price for BEA Systems. which led to his departure. The great majority of activist positions Even where activists The last time David since 2008 – 71 per cent according to have failed in their explicit goals, the Einhorn, the hedge fund activist Activist Insight – have at least made market reaction can help them out. behind Greenlight Capital, tried to money. Starboard failed to win a board seat at nudge a large and venerable In part, this reflects the rapidly AOL, but the share price nearly technology company into action, his changing nature of the technology doubled in the process. pleas fell on deaf ears. business, where companies can But some attempts at activism remain In May 2011 he urged Microsoft’s rapidly swing in and out of favour, as very much a work in progress. Mr board to sack Steve Ballmer, the well as the lack of takeover defences Whitworth was invited on to the company’s longstanding chief at most tech companies. board of Hewlett-Packard too late to executive. “Ballmer does not care One verteran banker says “a lot of affect the hardware company’s what Wall Street thinks and maybe tech companies grew up without a purchase of UK software group that’s a good thing,” said Mr Einhorn, proper capital structure”, and are Autonomy, but well before the but “his presence is the biggest now being forced into behaving like consequences of that takeover caused overhang for Microsoft stock”. more mature companies in other the share price to collapse. Mr Ballmer remains in place, industries. Mr Einhorn faces suggesting that the west coast still Elliott Management, significant opposition to his idea that thinks investors in general – and the the $20bn hedge fund run by Paul Apple issue preferred stock as a novel money men of Wall Street in Singer that is making a $2.3bn route to access its cash hoard, with particular – are a necessary evil to be offer for Compuware, has acted as a both of the main corporate tolerated, not indulged. stalking horse to flush out buyers in governance advisory firms, ISS and Now Mr Einhorn is going after Apple, the past, teaming up with technology- Glass Lewis, in opposition. where he is trying to persuade the focused private equity groups. But it is another sign of tech maturity. iPhone maker to set aside more of its For instance, Elliott took part in the The veteran banker says that he $137bn cash pile for investors. The buyout of MSC Software by the talked to Steve Jobs several times record suggests that the tech world Symphony Technology Group in 2009 about returning cash, but “he has been highly receptive to the after initially trying to buy the believed giving cash back to urgings of activists. company itself. shareholders was ridiculous.” Since 2007, when More conventional agitation tactics The banker says that only works so the veteran corporate raider Carl have also worked on tech companies. long as the share price goes up. Icahn became one of the first to Thomas Ivey, a partner at the law firm “Founders have a hard time accepting target tech by buying up stock in Skadden, says that “activists tend to that.” Motorola Solutions, the struggling win more than they lose when they Apple though has a share price in the mobile phone maker, there have been run or threaten to run a short slate” – doldrums and a new chief executive, 70 different activists involved in the attempt to elect directors to the Tim Cook, who said this week that he technology companies, according to board without pushing for control. is “seriously” considering returning Activist Insight. For instance, Ralph Whitworth’s more of Apple’s $137bn cash hoard to Mr Icahn fought a battle to install a Relational Investors took a stake in L-3 investors. Like most activists, Mr nominee on the board and agitated Communications and agitated for a Einhorn can still come out ahead – for a split of the company that finally break-up, leading to a $2bn spin-off. even if he does not get exactly what occurred in 2011. Then, as he pushed Mr Icahn stepped down from the he wants. for the company to sell its valuable board of Yahoo in 2009, where he had portfolio of patents, Google turned up tried to push the group into the arms to buy one of the two new of Microsoft, but last year Dan Loeb companies, Motorola Mobility, for picked up the baton. The head of the $12.5bn. hedge fund Third Point joined Mr Icahn also emerged a hero in the Yahoo board after a letter-writing Source : The Financial Times 4GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  5. 5. Icahns 13% Stake in Herbalife Presents Contrast With AckmanBy Duane D. Stanford and Miles Weiss assertion that he was shining a counter option contracts, the filingFebruary 15th, 2013 spotlight on Herbalife, the marketer shows. He purchased the remainder of weight-loss and nutritional of his stake through yesterday, It turns out billionaire investor Carl supplements, was “disingenuous.” according to the document.Icahn really is bullish on Herbalife Icahn, who has spent more than Icahn’s stake is comprised of 2.47Ltd., a position in sharp contrast to seven years wrangling with Ackman in million shares and options on anotherrival hedge-fund manager Bill court over $4.5 million, said in the 11.54 million shares.Ackman. interview he doesn’t “like” orIcahn, 76, reported a 13 percent stake “respect” Ackman and questioned his Raising Questionsin Herbalife yesterday and said he motives for publicizing his trade.would seek talks with the nutritional “You don’t go out and get a room full Herbalife surged as much as 25supplements company, sending the of people to badmouth the percent to $47.77 in extended tradingshares up as much as 25 percent in company,” Icahn said in the interview. yesterday, after gaining 5.1 percent toafter-hours trading. Strategic “If you want to be in that business, $38.27 at the close in New York. Thealternatives for Herbalife may include why don’t you join the SEC,” Icahn stock has dropped 10 percent throughtaking it private, he said in a filing added, referring to the U.S. Securities yesterday since Ackman disclosed hiswith the U.S. Securities and Exchange and Exchange Commission. short position.Commission. Ackman didn’t respond to telephone Ackman joined Greenlight Capital ReThe disclosure comes almost two and e-mail requests for comment. On Ltd. Chairman David Einhorn last yearmonths after Ackman said he had sold Feb. 7 he renewed his claim that in raising questions about Herbalife.short 20 million shares of Herbalife Herbalife is a pyramid scheme in a On Dec. 20, Ackman appeared at aand said it was a pyramid scheme. detailed 40-page treatise questioning Sohn Investment Conference in NewIcahn followed by saying last month everything from the company’s sales York and accused Herbalife of usingthat Ackman, 46, acted accounting to claims that it makes inflated pricing, misleading salesinappropriately when publicly millionaires. information and a complicatedannouncing his bet against Herbalife, incentive structure to hide a pyramidreviving a decade-old feud with the Share Purchases scheme.founder of Pershing Square Capital Herbalife executives and consultantsManagement LP. U.S. regulators at the Federal Trade hit back on Jan. 10, arguing that all ofAckman’s wager had already pitted Commission and the SEC have Herbalife’s payments to distributorshim against Daniel Loeb in a rare declined to say whether they are are tied to product sales and thepublic dispute among hedge-fund investigating Herbalife or intend to do company’s accounting practices aremanagers over whether Herbalife is a so. legal.legitimate enterprise or a fraud. Icahn didn’t respond to a telephone Ackman’s wager had already put him“Carl Icahn just delivered Bill Ackman request for comment. at odds with Loeb, founder of Thirda Valentine he’ll never forget,” hedge He purchased about 1.6 million Point LLC. Three weeks after Ackmanfund manager Robert Chapman of Herbalife shares between Dec. 20 and disclosed his bet against Herbalife,Chapman Capital LLC said in an e-mail Dec. 24, according to the filing. That Third Point reported in a regulatoryyesterday. Chapman Capital holds a was after Ackman disclosed on Dec. filing that it had bought 8.9 million oflong position in Herbalife. 19 his bet against the nutritional the company’s shares.Herbalife has repeatedly denied supplements company. Icahn In taking an 8.2 percent stake inAckman’s accusation that it is a restarted his share purchases in Herbalife, Loeb joined other firms inpyramid scheme. Herbalife on Jan. 28, after the rejecting Ackman’s theory. Bloomberg interview, and after he “It’s no secret I don’t like Ackman,” Legitimate Business said in a statement on Jan. 25 that Icahn said in the interview last month. Ackman was taking “inordinate risks” “But that doesn’t mean I am going to Icahn said in the filing that regarding his investment approach to go in and buy stock in a companyHerbalife “has a legitimate business Herbalife. necessarily just to get him.”model, with favorable long-term The stock may become the “motheropportunities for growth” and that of all short squeezes,” he said in thethe shares are undervalued. statement.Last month, in a Jan. 24 interview On Jan. 28 and Jan. 29, Icahn acquiredwith Trish Regan on Bloomberg another 3.6 million shares andTelevision, Icahn said Ackman’s options, primarily through over-the- Source : Bloomberg 5GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  6. 6. Peltz Helped Spur Heinz Turnaround Setting Stage for BidBy Miles Weiss Hathaway and Jorge Paulo Lemann’s restructurings and “poor capital-February 14, 2013 3G Capital agreed to buy the allocation decisions,” called on Heinz Pittsburgh-based company for $72.50 to take immediate measures to a share, Heinz said today. The reduce annual costs by at least $575 Nelson Peltz may warrant thanks transaction is valued at about $28 million. It also urged Heinz to increasefrom H.J. Heinz Co. stakeholders after billion, including the assumption of share repurchases, target higherBerkshire Hathaway Inc. and 3G debt. Heinz shares jumped almost 20 dividend payments and redirectCapital’s offer to buy the ketchup percent from their closing price payments and allowances provided tomaker for about $23 billion, even yesterday of $60.48 each. retailers into consumer advertisingthough the billionaire hedge-fund Anne Tarbell, Trian’s spokeswoman, and new product innovation.manager won’t share much in didn’t immediately return a callthe reward. requesting comment. Company’s Plan Trian Fund Management LP, the Trian acquired 18.2 million HeinzNew York-based money manager run shares for $673 million, the Heinz in June 2006 said it wouldby Peltz and his partners Peter equivalent of $36.89 a share, reduce spending by $355 million,May and Ed Garden, disclosed taking according to a filing with the U.S. raise its dividend, and buy back $1a 5.4 percent stake in Heinz in April Securities and Exchange Commission billion of shares over the next two2006 and then waged a six-month in April 2006. That included 12.86 years. The company simultaneouslyproxy fight to win five seats on the million shares held by the Trian funds sought to thwart Peltz’s proxy fight tofood company’s board. Heinz and 5.38 million shares purchased on gain board seats, telling investors thatmanagement sought to keep Trian’s behalf of funds run by Sandell Asset the billionaire had previously beennominees off the board and resisted Management Corp., also based in named in shareholder lawsuitsPeltz’s turnaround plan that called on New York. alleging self-dealing.the company to cut costs and sell Peltz and fellow dissidentassets. ‘Sharper’ Focus investor Michael Weinstein, the William Johnson, Heinz’s chief former chief of Snapple Beverageexecutive officer, eventually executed Peltz and his partners said in the Corp., gained board seats thatmany of Peltz’s suggestions, according 2006 filing they “see opportunities to September, though the remainder ofto John Sini, a portfolio manager at create value” at Heinz through Trian’s slate of candidates wereDouglas C. Lane & Associates Inc. in “sharper strategic focus, better denied directorships. Heinz sharesNew York. While Trian will miss out on operational execution and more have since provided an averagethe 20 percent premium that efficient uses of capital.” Trian said it annual return of about 9.9 percentBerkshire and 3G are paying for Heinz was notified on April 6 that Heinz had through January, compared with 4shares after selling off most of its rejected a request for board percent for the Standard & Poor’s 500stake, it was Peltz and his partners representation. Index.who got the company to focus on The next month, Trian issued a 21- “The kudos go to Bill Johnson, go toshareholder returns as well as its top page report called “Results Speak the management team, go to thebrands, Sini said in a telephone Louder than Words: A Plan to board in general,” Peltz said in aninterview. Enhance Value at Heinz” that said the interview today on CNBC. Johnson “Management did a great job company’s stock returns have “almost and other Heinz managers “executedexecuting the turnaround, but Peltz uniformly underperformed” the terrifically” on the strategic plan hewas the catalyst for a lot of the broader market and other consumer put forward in 2006, and “the result ischange,” said Sini, whose firm packaged-food companies since its a $72.50 all-cash offer.”oversees about $2.5 billion, primarily management team took over in Aprilfor wealthy individuals, and 1998. Heinz shares had fallen almost Stable Investmentheld Heinz shares at the time Trian 11 percent in the previous eighttook its stake. “We are looking at this years, Trian said, while an index of Peltz got the Heinz board to startprice now and saying, ‘Thank you, large- capitalization food companies thinking more about shareholderthank you, thank you.’” such as Campbell Soup Co. and value “and for that we have to thank Hershey Co. had increased more than him,” said Michael Crofton, the 20% Premium 26 percent. president and CEO of Philadelphia Trian, citing “ill-fated” divestitures Trust Co., which has been holding Warren Buffett’s Berkshire and acquisitions, “failed” corporate Heinz shares since at least 2008. … 6GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  7. 7. At the same time, much of the data compiled by Bloomberg. according to filings, and, betweencompany’s subsequent success January 2009 and last July, sold somestemmed from the popularity of Client Distributions 7.87 million shares for a total of aboutrelatively stable food companies with $356.7 million. That works out to anlarge dividend yields during a period Peltz said today on CNBC that Trian average of $45.33 a share.of high market volatility and low had “probably” sold its Heinz shares “Peltz was out at $50,” said Jamesinterest rates. “in the high 50s,” while regulatory Cullen, the CEO of Schafer Cullen “In the risk-off trade that was on filings show the prices were lower. Capital Management, a $14-billionuntil a year-and-a-half ago,” food Trian distributed about 3 million Heinz investment adviser based in New Yorkcompanies “were great places to shares on Feb. 29, 2008, to clients that holds Heinz shares. “A lot of thehide,” Crofton said. Heinz’s who had recently gained the right to activists tend to be more short-termmanagement, he said, also did a good withdraw their capital, according to a oriented.”job of focusing “on their core brands regulatory filing. Heinz shares tradedand building brand identity.” at about $44 each at the time of the The Trian funds have sold or distribution, which left Trian holdingdistributed most of their Heinz stake, about 10 million shares.leaving the firm with 106,500 The firm made several subsequentshares as of Sept. 30, according to distributions to other clients, Source : Bloomberg Lear shares rise as hedge fund seeks board seatsBy Bijoy Anandoth Koyitty BlackRock holds 7.45 percent of Lear said it would still engage inFebruary 8th, 2013 and Robeco Investment Management discussions with the management 5.3 percent, according a regulatory regarding the nomination of directors. Marcato Capital Management filing. The fund said that the 5.2 percentreported a 5.2 percent stake in auto Marcato said it recently discussed stake translates to 5,034,986 shares,parts maker Lear Corp and the hedge Lears capital allocation practices and which includes options to purchasefund said it planned to nominate actions, including share repurchases, shares that are exercisable within thecandidates to the board, sending its with the companys senior next 60 days.shares higher in early trading. management. Last week Lear, which has a marketShares of Lear, which in 2007 rejected Lear said on Thursday it would value of about $4.92 billion, reporteda $3 billion buyout attempt by an accelerate its previously authorized a fourth-quarter profit that beataffiliate of billionaire investor Carl share repurchases and increase its analysts expectations.Icahn, rose as much as 8 percent on dividend. The companys shares, which havethe New York Stock Exchange on "We believe that the market has gained 19 percent in value in the lastFriday morning. perceived management to have been three months, were up 4 percent atMarcato - run by Mick McGuire, one lethargic in its actual repurchase of $52.92 on the New York Stockof activist investor William Ackmans shares," Guggenheim Securities Exchange on Friday morning.former partners - becomes the third- analyst Matthew Stover wrote in alargest shareholder in the company note to clients.with the investment, behind Marcato, whose top holdings includeBlackRock Inc and Robeco Investment Trinity Place Holdings , GenCorp Inc,Management. Cincinnati Bell Inc and DineEquity Inc, Source : Reuters 7GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com
  8. 8. This newsletter has been prepared by, and is subject to the copyright of, Geneva Partners S.A. (Geneva Partners).This newsletter is confidential and has been furnished to the intended recipient solely for such recipient’s information and private useand may not be referred to, disclosed, reproduced or redistributed, in whole or in part, to any other person.This newsletter has been prepared on the basis of information provided to Geneva Partners and publicly available information. Thisinformation has not been independently verified by Geneva Partners. This newsletter does not constitute a due diligence review andshould not be construed as such. No representation or warranty as to this newsletters accuracy, completeness or correctness is madeand no reliance should be placed on the accuracy, completeness or correctness thereof. The information contained, and any opinionsexpressed, in this newsletter are subject to change at any time and Geneva Partners is under no obligation to inform the intendedrecipient or any other person of any such change.Geneva Partners accepts no responsibility or liability whatsoever in relation to this newsletter (including for any error or in relation tothe accuracy, completeness or correctness of this newsletter). The exclusion of liability provided herein shall protect Geneva Partners,its officers and employees in all circumstances.This newsletter is not intended to form the basis of any investment decision and does not constitute or form part of any offer to sell oran invitation to subscribe for, hold or purchase any securities or any other investment, and neither this newsletter nor anythingcontained herein shall form the basis of or be relied on in connection with any contract or commitment whatsoever. This newsletter isnot, and should not be treated or relied upon as investment research or a research recommendation under applicable regulatory rules.Geneva Partners is a member of the Swiss Association of Asset Managers (SAAM).Franck Berlamont 8GENEVA PARTNERS – 33 Quai Wilson – 1201 Geneva – Switzerland – Tel. : +41/22 906 95 95 – info@geneva-partners.com – www.geneva-partners.com