Third Point LLC, the hedge fund run by Daniel Loeb, acquired most of his stake in Yahoo! Inc. in the third quarter, amid efforts to force changes at the Internet search company, according to a regulatory filing today.
Third Point, based in New York, had 48 million common shares, valued at $632 million, of the Sunnyvale, California-based company at the end of the quarter, before adding another 8 million shares after Sept. 30, according to regulatory filings and data compiled by Bloomberg.
Yahoo was Third Point’s biggest holding by market value. Loeb wrote a letter to Yahoo’s board of directors Sept. 8, calling for changes to the board and Yahoo’s leadership. Loeb sent another letter to Yahoo’s board of directors earlier this month, demanding two board seats and asking co-founder Jerry Yang to step down as a director following reports Yahoo is considering a transaction with private-equity firms. In that Nov. 4 letter, the firm said it was Yahoo’s second-largest shareholder.
Yahoo’s shares have fallen about 3.8 percent this year. Third Point had 56 million shares of common stock in Yahoo and 10 million shares of common stock that could be acquired through options, according to a Nov. 4 filing with the SEC.
The firm sold 6 million shares of Houston-based El Paso Corp., a pipeline company, which was its biggest holding in the second quarter. El Paso announced Oct. 16 that Kinder Morgan Inc. agreed to acquire the company. If the acquisition is completed, the combined company would represent the largest natural gas pipeline network in the U.S. El Paso was its third-largest holding in the third quarter with 7 million shares valued at $122 million.
Third Point increased the value of its stakes in information technology companies by 24 percent, while the value of its holdings in the materials industry decreased by 9.9 percent and financials fell by 4.6 percent, Bloomberg data show.
Third Point cut its stake by 1.5 million shares in Plymouth, Minnesota-based Mosaic Co., a fertilizer company, according to today’s filing.
The firm raised its holdings in natural gas company Williams Cos., based in Tulsa, Oklahoma, by about 4.15 million shares to 5.25 million shares.
Third Point is an event-driven fund, betting on companies facing mergers, spinoffs and bankruptcies. Elissa Doyle, a spokeswoman for Third Point, didn’t respond to an e-mail seeking comment.
Money managers who oversee more than $100 million in equities must file a Form 13F within 45 days of each quarter’s end to list their U.S.-traded stocks, options and convertible bonds. The filings don’t show non-U.S. securities or how much cash the firms hold.
Hedge funds are lightly regulated pools of capital whose managers can invest in any asset, and share in annual profits.