This content is from: Portfolio

The Morning Brief: Sotheby’s Reimburses Third Point $10 million for its Activist Efforts

Heads we win, tails you lose. This apparently was the deal Third Point’s Daniel Loeb wound up making with Sotheby’s, the auctioneer giant. Sotheby’s disclosed Monday it took $20.1 million in charges for the nine months through September 30 related to legal and other fees stemming from Third Point’s proxy fight. This works out to nearly half the $43.8 million in earnings Sotheby’s reported for the first three quarters.

Of the charge, $10 million went to reimburse the New York activist hedge fund for its activist campaign. On May 4, 2014, Sotheby’s expanded the number of directors by three, adding Loeb and two others to the board. However, even after the stock surged about 5 percent Monday, it still remains more than 12 percent below where it stood in late August 2013 when Third Point disclosed its 5.7 percent activist stake. Still, the stock is up more than 9 percent from the end of June 2013, when Third Point disclosed it owned 2.5 million shares of Sotheby’s.

___

NCR has named Richard “Mick” McGuire III of San Francisco-based Marcato Capital Management a director, boosting the size of the board from eight to nine. McGuire, whose firm owns 6.5 percent of the stock, will serve on the technology company’s executive committee and compensation and human resource committee, according to the company’s announcement. Marcato changed the status of its investment in NCR from passive to active on October 22.

___

Clifton Robbins’ Greenwich, Connecticut-based activist hedge fund firm Blue Harbour Group bought more than 1.8 million shares of Babcock & Wilcox for between $30.03 and $30.36 per share, boosting its stake to 8.6 percent of the total outstanding shares. The purchases took place on November 6-7, after the company announced that its board unanimously approved plans for the tax-free spin-off of its power-generation business to B&W’s shareholders. It also announced executives who will lead the two companies after the split. Babcock & Wilcox will comprise power-generation equipment and services and BWX Technologies will include the government and nuclear operations business. In early May, Blue Harbour disclosed it owned 6 percent of Babcock & Wilcox. The week before at the Active-Passive Investor Summit in New York, Robbins said B&W was “misvalued and misunderstood,” calling it “a sum-of-the-parts play.” On Friday, Blue Harbour also disclosed it had sold 700,000 shares of CACI International, a professional-services and information-technology company. It still owns 7.2 percent of the shares.

___

Citadel disclosed that it owns 7.28 million shares of Newfield Exploration Company, or 5.3 percent of the total outstanding. At the end of the second quarter, the Chicago hedge fund firm owned a little more than 1.7 million shares, plus put and call options.

___

PointState Capital disclosed that it owns a 6.4 percent stake in Synergy Pharmaceuticals, a biopharmaceutical company that specializes in developing therapies based on a natural human hormone, uroguanylin, to treat gastrointestinal diseases and disorders. The New York hedge fund did not own any shares of the stock at the end of the second quarter.

Related Content