Equity deals made by Elliott since 2010
The World’s Most Feared Investor
Aggressive, tenacious and litigious to a fault, Paul Singer may be the most feared activist investor in the world—by hedge fund rivals, companies and even countries. Singer’s Elliott Management Corp., which manages $34 billion of assets, has rarely been out of the headlines in the past 18 months. There’s little indication that will change soon.
Singer has targeted the world’s biggest mining company, taken on Warren Buffett in a battle for Texas’s largest electricity distributor, ousted chief executive officers on both sides of the Atlantic and set off a chain of events that led to the impeachment of South Korea’s president.
Singer is best known for battling Argentina for 15 years over its debt default—and impounding one of the country’s warships in the process. Certainly, his impact is undeniable. He started with just $1.3 million from family and friends in 1977, and the fund’s investments in equity and debt have since led to at least $93 billion in corporate asset sales and share buybacks, according to data compiled by Bloomberg.
While he’s been scorned for employing bullying tactics at times, Singer doesn’t worry about his tough reputation. He sees it as a selling point for his investors.
“It doesn’t bother me anymore,” Singer told Carlyle Group LP co-CEO David Rubenstein in a Bloomberg TV interview. “It’s good when a corporate executive listens with the understanding that we are real, that we have the capacity to carry through.”
Here’s a look at Elliott’s investments in recent years, their performance and their impact:
Equity investments made by Elliott since 2015
Elliott released a 10-page letter and 31-slide presentation in October 2016 urging Samsung to split into two companies. The activist investor also said the company should add three independent directors and start paying dividends. In April, Samsung rejected most of the demands but offered to pay its first-ever quarterly dividend and cancel tens of billions of dollars in treasury shares.
Elliott, which became a major shareholder in 2015, opposed a takeover by Cheil Industries, sayingthe bid significantly undervalued the conglomerate. In July of that year, a South Korean court rejected Elliott’s requests to halt stock sales related to the deal, paving the way for the merger to go through. In 2016, prosecutors started investigating whether payments made to entities controlled by Choi Soon-Sil, a confidant of the country’s President Park Geun-hye, helped Samsung win support for the merger. Park was impeached and removed from office and is currently on trial for bribery. Samsung heir Jay Y. Lee is being tried for bribery as well.
In April, the activist investor went public in its fight against the world’s largest mining company, releasing a 10-page letter seeking a spinoff of BHP’s estimated $22 billion in U.S. oil assets. BHP said it would explore a sale of its U.S. shale assets and delay a move into potash on Aug. 21.
Elliott upped its stake in the aluminum-parts maker after it was spun out of Alcoa Corp. in November 2016. Soon after, Elliott launched a campaign to oust CEO Klaus Kleinfeld. Arconic countered by offering to revamp its board and give two seats to the firm. Events then took a bizarre twist in April after Kleinfeld fired off a letter to Elliott that the firm described as “threatening,” which led to his resignation. In May, the company agreed to add three Elliott nominees to the board.
Elliott has built a stake of up to 5 percent in oil and gas explorer Energen Corp. and is pushing for a sale of the company, a person familiar with the matter said on Aug. 17. The company had already been targeted by activist investor Corvex Management, which is also pushing for a sale.
Elliott disclosed a 6 percent position in NXP on August 4, 2017. The hedge fund is seeking to block a proposed $47 billion takeover of the semiconductor company by Qualcomm Inc., according to people familiar with the matter. Elliott wants Qualcomm to increase its bid, NXP to find a higher offer, or for the company to remain independent.
In July, Elliott became the drugmaker’s biggest shareholder. The company received a second takeover offer by buyout firms Bain Capital and Cinven for 5.4 billion euros ($6.2 billion). The bid has the backing of Stada’s board and top managers. Stada shareholders approved the deal on Aug. 18, with the support of Elliott, according to people familiar with the matter.
The firm disclosed a 9.2 percent stake in May, saying the online medical billing provider was substantially undervalued. Athenahealth said on Aug. 1 that it would separate the roles of chairman, chief executive officer and president and add a new independent board member, as well as embark on cost cuts.
Elliott owns 15.3 percent of Gigamon and said the company should review all its options, including a sale.
As the real estate company’s biggest shareholder, Elliott said it may propose changes to its board.
In May, Roadrunner said Elliott had invested $540 million, which the trucking company will use to help pay debt.
After the Dutch paintmaker rejected a $22 billion takeover bid from PPG Industries Inc., Elliott took AkzoNobel to court to oust its chairman over his refusal to negotiate. The two sides called a truce on Aug. 16, giving the new CEO, Thierry Vanlancker, some breathing space to proceed with a plan to dispose of Akzo’s chemicals division.
Elliott targeted the power producer in January as part of a group that includes Bluescape Energy Partners.
The activist investor disclosed an 8.3 percent stake in January, saying it may seek changes at the health-care company. The two parties reached a standstill agreement two months later.
Elliott took a 4 percent stake and said Cognizant could be worth more than $90 a share if it improved operations and changed its capital and compensation structures.
In November, Elliott urged a full strategic review after acquiring an interest in the oil company. Two months later, Marathon said it would speed up its asset sales and consider a spinoff of its gasoline and convenience stores.
Siemens bought the company in November for $4 billion, two months after Elliott became its biggest shareholder and said it was deeply undervalued.
Less than two months after Elliott disclosed its 9.8 percent investment, the cybersecurity-software company hired Qatalyst Partners to help review its options, including a sale of the business. The process was put on hold in October while suitors waited to see if the company’s growth could improve enough to draw a higher price.
The activist investor pressed for changes at the homebuilder as Bill Pulte, the company’s co-founder and largest shareholder, campaigned to remove the CEO. In July 2016, the company said it reached an agreement with Elliott to appoint three new board members and to cut spending.
Elliott disclosed an 8.9 percent stake and began pressing the board to explore ways to boost Qlik’s value. In June last year, Thoma Bravo bought the company for roughly $3 billion.
More than four years after buying 6.4 percent in the aluminum producer and supporting its breakup, Elliott won three new board seats.
Elliott became a major shareholder in the lender and opposed its plan to spin off one of its units. American Capital reviewed its options and in May 2016 agreed to sell itself to Ares Capital for $3.4 billion.
The firm disclosed an interest in Dialog after the company announced a plan to buy Atmel Corp. for $4.6 billion. Dialog eventually walked away from the deal after Atmel received a higher bid from Microchip Technology.
The hunting, fishing and camping retailer agreed to a $5.5 billion buyout by Bass Pro Shops in October, a year after Elliott made an investment in Cabela’s and said the company was a takeover target.
The firm pushed for a merger of Polycom and Mitel Networks Corp. after building up stakes in both companies. Mitel agreed to buy Polycom in April 2016 for $1.96 billion but backed off after Siris Capital Group LLC offered more.
Mitel lost out to Siris Capital Group LLC in its attempt to merge with Polycom Inc. In July, it agreed instead to buy competitor ShorTel Inc. for $530 million. Elliott, which has been pushing for consolidation of the industry, cheered the deal.
Four months after Elliott disclosed its investment in LifeLock, Symantec Corp. agreed to buy the identity-theft protection provider for $2.4 billion.
Since Elliott first disclosed its holding, Citrix added Elliott’s Jesse Cohn to its board, spun off its GoTo unit and started to work on a potential sale.
A year after Elliott urged CDK to improve margins, cut costs and boost shareholder returns, the company added two independent directors as part of an aggressive cost-savings program.
Elliott’s major debt situations
A creditor from its record default in 2001, Elliott refused an offer from the government to swap its obligations with bondholders and held out for 15 years as it pursued repayment through court. During the long and acrimonious saga, Elliott tried to force Argentina to the negotiating table by stymieing the country’s ability to raise money abroad and attempting to seize assets. In 2012, the firm tried to seize a government ship docked in Ghana. A year later, then-President Cristina Fernández de Kirchner hired a commercial jet because she feared creditors might impound the presidential plane. The dispute was finally settled last year, and Elliott received $2.4 billion—equal to about four times the face value of the bonds it held.
Creditors, including Elliott, gained a 50 percent stake in the renewable-energy producer after providing more than a billion euros in loans.
Billed as a “Godzilla vs. Godzilla” battle, Singer went toe-to-toe with buyout titans Leon Black and David Bonderman, whose firms owned the casino operator. In January, Caesars won court approval to emerge from bankruptcy, putting Elliott in prime position to own significant stakes in both the new Caesars and an investment trust that will own its properties.
Singer was locked in a battle with billionaire investor Warren Buffett over the fate of the biggest electricity distributor in Texas. Elliott snapped up the bankrupt company’s debt and said it planned its own $9.3 billion bid for Oncor Electric Delivery Co. after opposing Berkshire’s $9 billion offer. Elliott eventually bought about $60 million in unsecured notes, blocking Berkshire’s bid. On Aug. 20, Sempra Energy said it had reached an agreement to acquire Oncor for $9.45 billion.
Elliott proposed a $2.9 billion capital injection to help the telephone operator restructure its debt and emerge from bankruptcy protection. In exchange, the firm would get a majority stake.