Who Targeted Whom and What Happened
from September/October 2006
A sampling of what various activists pushed for—and how they made out
| Attacker | Target | What happened |
| Opportunity Partners | New Germany Fund | Opportunity Partners, a hedge fund with an 8.3% stake in the Partners Fund closed-end fund New Germany, which invests primarily in the Mittelstand (a group of small- and mid-cap German companies), asked other shareholders at the 2006 annual meeting to votefor a slate of three new directors who’d push to liquidate the fund, claiming it was selling at a chronic discount to its assets. Investors opted to stick with all 11 current board members; New Germany responded to the attack with plans to goose the fund’s performance. |
| Steve Bostic | Career Education Corp. | Holding just over 1% of the shares in this owner of vocational Education schools and colleges, Bostic, a private investor, proposed a new Corp. slate of three directors (he being one of them). At the annual meeting, other investors voted to keep the present nine-person board. Bostic, who had spent two years pushing for change at the company, opted to sell his shares (worth some $50 million) and move on, saying he had zero confidence in management or the directors. |
| Pirate Capital | Gencorp | Pirate Capital, a hedge fund with an 8.5% stake in this aerospace and defense contractor, urged shareholders to elect three dissident directors to the 10-person board and support a resolution to declassify it. Investors went along with both proposals, and it looks as if GenCorp will abide by their wishes. |
| Third Point | Massey Energy | The investment management firm Third Point, with 5.9% of this Energy coal company’s stock, persuaded investors to elect its two nominees to the nine-person board. Third Point is continuing its push to get Massey to step up its share-buyback program from $50 million to $500 million. Massey is contesting the election of one dissident director and resisting the buyback increase, claiming that it would dangerously leverage the company. |
| Knightspoint Group | Sharper Image | Knightspoint, a group of individuals and investment firms thatGroup Image own 12.8% of the retailer’s stock, sought to replace all seven of its directors to force through a revamp of company strategy and reductions in executive compensation, among other things. The two sides reached an accord prior to the annual meeting, after Sharper Image increased the size of the board to nine seats. Three will be occupied by current board members, three will be Knightspoint’s to fill, and three will go to nominees the two sides agree upon. |
Source: Altman Group
