PulteGroup Shares Jump as Elliott Management Takes Stakeby
Company says it was recently informed of investor’s position
Homebuilder has been subject of criticism from co-founder
“Elliott recently informed us that they have taken a position in the company,” PulteGroup said in an e-mailed statement. “We welcome dialogue with all of our shareholders.”
PulteGroup’s shares rose 3.6 percent to $19.37. Elliott, which has undertaken activist campaigns at companies including CDK Global Inc. and American Capital Ltd., didn’t respond to a request for comment. CNBC reported the stake earlier Tuesday.
PulteGroup’s co-founder and largest shareholder, Bill Pulte, earlier this year called on Chief Executive Officer Richard Dugas to resign immediately, saying he is responsible for the departures of talented executives, overly aggressive land purchases before the housing crash and a stock underperformance relative to some peers. Dugas said he will step down next year.
“We believe PulteGroup is an undervalued asset and are happy that a well-respected hedge fund agrees,” Bill Pulte’s grandson, who shares his name, said in an e-mailed statement Tuesday.
While most of Elliott’s investments aren’t activist -- where it amasses shares and seeks to convince executives and directors to make changes to boost shareholder returns -- it’s those campaigns that often attract the most attention.