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Chris Hughes

Elliott Is Playing Hardball Again in Germany

The activist hedge fund is picking fights again. Wary investors may be too skeptical of prospects for success. 

Paul Singer, billionaire and chief executive officer of Elliott Management Corp.

Paul Singer, billionaire and chief executive officer of Elliott Management Corp.

Photographer: Bloomberg

Elliott Management Corp. is resuming confrontational activism in Germany, potentially reviving fears that “locust” funds are back and up to no good. Investors are probably being too skeptical that Elliott will be able to force positive change.

The activist hedge fund has lambasted managers at Scout24 AG, a Frankfurt-listed online real estate and car classifieds business capitalized at 5.4 billion euros ($6 billion). They are a soft target. The company’s board backed a cheap bid from Scout24’s former private-equity owners in February, only to see shareholders resoundingly reject the offer in May. The debacle has exposed the group to the broader attack that bad management is the reason for the share price weakness which triggered the attempted takeover.