Activist Daily: Getting formal with activism

Activist acolyte, strong day today. Activist investing news and stories for June 24 below. You should know by now that the free newsletter is on a 24-hour delay. Subscribe to Activist Strategy to get it on publication day or request a two-week free trial here. As usual, check out the tweets on @activiststocks to stay in the know and get on the free daily newsletter list.

News-

  • Iroquois Capital has gone active on Lrad Corp. with a 5.6% stake. It cites poor capital allocation and insider sales [link to letter]

  • Roumell Asset has changed its passive stake in Rosetta Stone from passive to active, owning 5.5%. Rosetta has been in talks with private equity [our notes that Osmium is supporting a buyout]. Osmium is active there with a 9.7% stake and Nierenberg Investment Management is also active with a 7% stake.

  • Baker Street Capital is active on Walter Investment Management with a 22.3% stake. Baker noted that this would remain a passive investment. The stock is up 40% YTD.

  • Wexford Capital is now active on Famous Dave’s, owning 19%. Last week, Blue Clay Capital founder was installed as interim CEO. Lioneye Capital is also an activist in Famous Dave’s with a 12.8% stake. PW Partners is active there too with a 10.3% stake.

  • Mill Road Capital sold off half its stake in Learning Tree, now owning 5.1% of the company.

  • Maguire Asset Management upped its stake in Novatel Wireless from 5.5% of the company to 6.7% [link to letter]

  • GM activist talk to takeover for Fiat is waning. The activists involved, owning 1.5%, have made private comments that they are more interested in cutting costs than a merger.

Stories-

  • The SEC, specifically, commissioner Dan Gallagher, gives a detailed account of what activism is, it’s a heck of a long read [link]

  • Proxy Monitor does a study on pension funds and activism. It’s a long read as well, of note, “These findings substantially undercut the hypothesis that public pension funds’ shareholder-proposal activism adds to share value for the average diversified investor” [link]

  • The San Francisco Chronicle puts out a piece on what Bill Ackman got wrong at a Stanford Law Q&A. Target and J.C. Penney are the focus. Of note, Ackman got the question, What exactly is your business? Ackman replied, “Harvesting souls” [link]

What we’ve been working on-

  • Johnson Controls notes on being its own activist [full paywall]

  • Activism in the REIT space [full paywall]

  • Darden Restaurants is forming a REIT [link]

  • A potential activist target in the airline parts space

  • A company that’s its own activist but could be buyout bait [full paywall]

  • GO Investment ups its stake in Premier Farnell [link]

  • An ode to Kirk Kerkorian, Part I: Making of a visionary [link]

  • Ode to Kirk Kerkorian, Part II: The hustle [link]

  • Notes on the United Rentals, Hertz and Jana Partners mess [link]