Zeno’s Takeover
Also prime brokerage, private-wealth risks and the Strategy premium.
The naive way to buy a public company is: You log into your Robinhood account, you type in the company’s ticker, and you click “buy” repeatedly until you own 51% of the company’s stock. Then you call up the company’s board of directors and say “hi, I am the new owner, I have a new business plan that I think you’ll really like, let me tell you about it.” The board looks at the stock registry and says “hmm, checks out, okay, tell us what you’d like us to do.”
This is not the normal way to buy companies. It comes up from time to time. It’s how Warren Buffett came to run Berkshire Hathaway Inc., for instance. And we talked last year about a Saudi Arabian family office that managed to buy The Children’s Place this way, in the open market. I found it weird. It’s not always easy to acquire a controlling stake in the open market, and you’ll probably pay up for it, and don’t you want to at least talk to the CEO first?