Daily Activist Investing May 27: Reminiscing of Buffett as an activist

Activist fans, going to be brief today, as like us, I’m sure you have plenty of catching up today - or in the least still recovering from a long weekend hangover. Activist stories and news for May 26 set up below - as usual the free newsletter is on a 24-hour delay; Activist Strategy subs only ones getting it on time. Still taking leads at @activiststocks, daily newsletter sign up is here and check out past newsletters.

News-

  • Legion Partners is pulling its proxy battle at Perry Ellis after it effectively forced the CEO to step down last week [last week’s comments]

  • Barington Capital won its proxy battle at Eastern Co. ($EML) last Friday, getting two dissident directors on the 5-person board [brief story]

  • Glenhill Advisors joins GAMCO as an activist at PepBoys. They own 7% and note that with GAMCO seeking board representation and interest from private equity that it may choose to engage with potential buyers [Glenhill news, and previous PE interest coverage]

  • Sandell Asset Management sends a letter to PartnerRE [letter], saying that the Axis Capital merger is hurting shareholders.

Stories-

  • The CFA Institute has a piece on Warren Buffett as an activist investor. Key takeaway, “But in Buffett’s early days, he actually engaged in numerous activist investments, including his takeover of Berkshire Hathaway. Much like today’s most notorious activist investors (Carl C. Icahn, Bill Ackman), Buffett made a name for himself by identifying market inefficiencies that could be exploited for the benefit of his investors and public shareholders. But unlike the corporate raiders of the 1980s, Buffett wasn’t out to tear companies down. In fact, he wanted to help build them up [link]

  • @activistinvestr has a piece on pension funds and activist investors and the dynamics there. The key issue is, “we have also talked with a number of senior executives from pension funds. They question the motives of hedge fund activist investors. They wonder whether activists merely and opportunistically seek to strip cash and other liquid assets from troubled companies, rather than repairing them.” Although certain deviations of late would suggest that this isn’t the case. Many activists are teaming up with activists to takedown management, but there’s still a lot of closed-mindedness among the largest pension funds [link]