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Engaged Capital Joins Pleasant At MagnaChip

Engaged Capital has gone active on MagnaChip Semiconductor with a 7.3% stake.

It peeled the idea from Pleasant Lake Partners, which went active last month with a 9.9% stake. Our thoughts are in Activist Strategy. Engaged says the core assets and semiconductor products business are attractive to potential strategic acquirers and/or partners.

The company has been through a financial restatement process and still trades at a discount given that overhang.

Recall that in early 2014, the company’s audit committee announced that it incorrectly recognized revenue in 2011, 2012, and 2013, leading to a yearlong restatement process that wasn’t completed until this February.

When the restatement was finally completed, and the company finally released its 2014 earnings, shares dropped 40%.