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The Morning Brief: Elliott Takes Steps in Two Different Battles

Paul Singer’s firm called a truce with AkzoNobel and raised its economic interest in BHP Billiton.

Paul Singer’s Elliott Management Corp. settled — for now — one activist battle and stepped up its efforts in another one.

Dutch paint and chemicals company AkzoNobel on Wednesday announced a truce deal with the sometime-activist firm, agreeing to a variety of steps, including the separation of its specialty chemicals unit. Elliott also agreed to support the appointment of chief executive Thierry Vanlancker to the board of management at the company’s extraordinary general meeting on September 8 and to support two new nominations to AkzoNobel’s supervisory board. AkzoNobel and Elliott also agreed to suspend all ongoing litigation for at least three months.

The battle began when Elliott urged AkzoNobel to discuss a takeover offer from competitor PPG Industries. Akzo rejected several offers and PPG abandoned its overtures in June. Elliott subsequently lifted its stake in the company to 9 percent. “Elliott is pleased to have entered into today’s standstill agreement with AkzoNobel,” states Gordon Singer, CEO of Elliott Advisors (UK) Limited, in a joint press release. “We believe AkzoNobel will benefit from the addition of the Supervisory Board nominees.”

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Separately, Elliott raised its “economic interest” in BHP Billiton’s London-listed shares from 4.1 percent to 5 percent, according to Reuters. This threshold enables Elliott to call a general meeting of shareholders of the miner and submit a resolution for shareholders to vote on. Elliott said it holds a small economic interest in BHP’s Australian shares, according to the report. “BHP appears to have already taken steps toward a smarter, more value-generative way of conducting business, and we support and encourage continued progress,” Elliott said, according to the report.

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Boothbay Fund Management, a multistrategy firm headed by Ari Glass, disclosed it owns 400,000 shares of Atlantic Acquisition Corp., or 7.5 percent of the total. The blank-check company, which went public a week ago, was created to do some sort of deal with a company or companies being operated by and/or serving ethnic minorities in the United States, especially within Asian-American communities in the consumer industry.

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Call this a stealth investment. Pershing Square Capital Management’s Bill Ackman said on a conference call he had a sizable position in hotel operator Hilton Worldwide Holdings but sold all his shares after the stock zoomed to an all-time high, according to Bloomberg. The hedge fund firm started buying the shares in 2016. At one point they accounted for more than 5 percent of Pershing Square’s assets. However, the firm sold the stock over the past 45 to 60 days.

“Our big disappointment here is we were not able to make it as large as a position as we would have liked,” Ackman reportedly said. Pershing Square never disclosed this investment in any regulatory filings, presumably receiving a waiver from the Securities and Exchange Commission.

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