Appendix A. Glossary
Schedule 13D
When a person or group of persons in the US acquires beneficial
ownership of more than 5% of a class of a public company’s
equity securities they must file a Schedule 13D within ten
days after the purchase.
Arbitrage
The purchase and simultaneously selling of a security or asset in
order to profit from (often small) price discrepancies. Often
occurs between two different markets.
Bear market
When selling exceeds buying (so prices go down)
Blue Chip
Listed company which is financially strong, often large and
has much investor interests.
Bull market
When buying exceeds selling (so prices go up)
Leverage
Borrowing money which is invested and should earn a greater
rate of return than the cost of borrowing (usually interest).
Long position (securities)
Holding securities, expecting that the value of the securities will
increase.
(options)
Options bought exceed options sold.
(currencies) An excess of purchases over sales
Mutual fund
Fund that raises capital from individual investors and
invests it into securities. The investment proceeds
(dividends etc) are passed along to the individual
investors.
Open ended investment
An investment vehicle in company form, from which the
investment criteria and fund size continually
can be adjusted in response to demand.
Proxy fight/contest
Attempt by individuals or organizations to get control in or over
an organization by using proxy votes, (votes from other
shareholders).
SEC
Securities and Exchange Commission (US)
Short position (securities)
The borrowing and simultaneous selling of securities,
expecting that the value of the securities will has decreased
when the borrowed securities should be delivered back.
Appendix B. Hedge funds and other parties involved in
activism
Hedge funds involved in activism
8 6 5 5 4 4 3 3 2 2 2 2 2 2 2 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Hedge funds Icahn
The Children's Investment Fund Centaurus Capital Steel Partners Atticus Capital Elliott Associates Pirate Capital Paulson & Co
Polygon Investment Management Highfields Capital Management SAC Capital Partners
Omega Advisors Trian Fund Management Highland Capital Management Barington Capital Group
Mellon HBV Alternative Strategies Relational Investors
Accipiter Capital Management Knight Vinke Asset Management Amber Capital Investment Management Marathon Asset Management
M2 Capital Management Millennium Partners K Capital
JANA Partners
TPG-Axon Capital Management Glenview Capital Management North Sound Capital
Templeton Global Advisors ESL Investments
Havens Advisors
Farallon Capital Management Laxey Partners
Fursa Alternative Strategies Trafalgar Capital Management Sparx Asset Management ValueAct Capital
Parvus Asset Management
Pershing Square Capital Management Third Avenue Management
Pardus Capital Management Schultze Asset Management Third Point
Horizon Asset management
Frequency
Other parties involved in activism together with hedge funds
8
3
1
1
1
1
Shareholders else than hedge funds
Others
Fidelity Investments (investment fund)
UBS Global Asset Management (investment fund)
Cam North America (investment fund)
Dynamo (investment fund)
Permira (private equity fund)
Frequency
3
No. Target company Country target Year Insurgent 1 Insurgent 2 Stake Goals and reasons of attack Methods Results Cause of failure
1 ABN AMRO Netherlands 2007 The Children's Investment
Fund
1 divest units of bank to create shareholder value after
long-term underperformance
pressure
2 Affordable Residential
Communities
United States 2007 Farallon Capital
Management
10 acquire the manufactured home community business
from company
negotiation accomplished 3 African Platinum United
Kingdom
2006 North Sound Capital 10,1 oust chairman Hansard after underperformance share
price
vote in EGM accomplished 4 Ahold Netherlands 2006 Centaurus Capital Paulson & Co 6 divest all US operations and return money to
shareholders (dividend) pressuring partly accomplished 5 Alvis United Kingdom 2004 Trafalgar Capital Management
others 18 get higher price for company than bid of General
Dynamics pursuading BAE for a
competitive bid accomplished
6 American HomePatient United States 2006 Highland Capital
Management
9,9 improve performance, change capital structure (lower
leverage), change company's by-laws vote in ASM own board
nominate, buyout of
company
failed Highland withdrew efforts
7 Aquila United States 2007 Pirate Capital 5 block management-proposed split-up and sale of
company
class-action lawsuit 8 Arcelor Mittal Luxembourg 2006 The Children's Investment
Fund Dynamo (investment
fund)
. get Mittal to pay Arcelor Brasil minority shareholders
the same 82% premium for their shares as the
shareholders of Arcelor pressure, judgement of Brazilian financial regulator CVM partly accomplished
9 ASM International Netherlands 2006 Mellon HBV Alternative
Strategies
7 divest company's back-end operations vote in EGM failed lack of shareholder support 10 Atos Origin France 2007 Centaurus Capital Permira (private equity
fund)
9,5 buyout of company bid for company failed bid too low 11 Blockbuster United States 2005 Icahn 10 accountability of management for too high spending,
higher dividends vote in ASM for 3 new
board members
accomplished 12 CeWe Color Germany 2006 M2 Capital Management K Capital 16,6 management replacement due to lack of performance,
payment of credit-financed special dividend
vote in EGM failed lack of shareholder support 13 Chiron United States 2006 ValueAct Capital Cam North America
(investment fund)
30 get higher price for company than bid of shareholder
Novartis threaten to vote against
in EGM accomplished
14 Chubu Electric Power Japan 2007 The Children's Investment
Fund
1 share buybacks, higher dividends pressure
15 Clear Channel
Communications
United States 2006 Highfields Capital
Management Fidelity Investments
(investment company)
14,2 get higher price for company threaten to vote against
bid
accomplished 16 Delphi United States 2006 Highland Capital
Management
8,9 buyout and rescue of firm by insurgent to improve
capital structure and corporate governance
pressure failed company got court approval for other rescue plan 17 Deutsche Börse Germany 2005 The Children's Investment
Fund
Atticus Capital 12 block takeover of London Stock Exchange, ousting CEO
and chairman pressure, majority
support
accomplished 18 Euronext France 2006 Atticus Capital The Children's
Investment Fund
20 link-up with Deutsche Borse or NYSE pressure, majority
support accomplished 19 Euronext France 2005 Atticus Capital 9 block takeover of London Stock Exchange because price
too high
pressure accomplished 20 Heinz United States 2006 Trian Fund Management 5,5 get 5 board seats, changes in company because
performance too low, get higher dividends proxy fight partly
accomplished
5
No. Target company Country target Year Insurgent 1 Insurgent 2 Stake Goals and reasons of attack Methods Results Cause of failure
22 Inamed United States 2005 SAC Capital Partners 6,4 block bid for company of Medicis, support higher bid of
Allergan threaten to vote against
bid accomplished
23 Inco Canada 2006 Havens Advisors . block buyout by Phelps, support buyout by Vale vote in EGM accomplished 24 J-Power Japan 2007 The Children's Investment
Fund
9,9 triple dividend requesting 25 Kerr-McGee United States 2005 Icahn JANA Partners 7,6 share buyback and sale of Chemical Business threaten with proxy fight
for two own board
members accomplished
26 Kmart United States 2005 ESL Investments 53 merge with/acquire Sears vote in EGM accomplished 27 KT&G South Korea 2006 Steel Partners Icahn 6,72 improve operating performance to increase shareholder
value, sale of units bid on company, get
board seats partly
accomplished
28 Laurus Netherlands 2005 Amber Capital Investment
Management
11,5 divestment of Conmar and Edah units, reorganization pressure, threatening
with egm
accomplished 29 Lexar Media United States 2006 Elliott Associates Icahn 23,8 block acquisition by Micron, bid too low threaten to vote against
bid
accomplished 30 LifePoint Hospitals United States 2006 Accipiter Capital
Management
1,6 block $330 million bid for five rural hospitals from
HCA, make changes in leadership vote three members to
the board failed nomination of board members
too late, appeal at court for voting was denied
31 London Stock Exchange United Kingdom 2005 Horizon Asset management Kinetics Asset management
25 block takeover of company by shareholder Nasdaq, bid
too low pressure not to sell
shares
accomplished 32 Mair Holdings United States 2007 Schultze Asset
Management
5,9 block proposed acquisitions by company, instead cash
payments to shareholders, sell Big Sky subsidiary discussions, litigation,
proxy proposals, EGMs
33 McDonald's United States 2006 Pershing Square Capital
Management
4,9 sell some company-owned restaurants, distribute proceeds to shareholders through dividends, share
buybacks
public pressure failed no management support, settled by negotiations, some extra
disclosure measures 34 MCI United States 2005 Omega Advisors Paulson & Co 12 block takeover of company by Verizon, support higher
Qwest bid boycott re-electing
directors vote at ASM as protest, threaten with
proxy fight partly
accomplished
35 Medidep France 2005 Amber Capital Investment
Management
Centaurus Capital 42,65 sale of company (to competitor Suren) to maximize
shareholder value forcing chairman to
resign in ASM due to conflicts of interest in
company
accomplished
36 MedImmune United States 2007 Icahn 1 get company sold threaten with proxy fight accomplished 37 Mirant United States 2006 Pirate Capital Omega Advisors 7 block takeover of NRG Energy pressure accomplished 38 Mony United States 2003 Highfields Capital
Management Third Avenue
Management
7,6 block buyout of company by AXA, price too low,
management changes better
vote in EGM failed majority in favour of buyout 39 Motorola United States 2007 Icahn 2,7 buyback of shares, help Motorola address some
operational deficiencies proxy fight in ASM to
get board seat
failed lack of shareholder support 40 Mylan Laboratories United States 2004 Icahn UBS Global Asset
Management
(investment fund)
13,68 block proposed takeover of King Pharmaceuticals, price
too high pressure, threaten with
proxy fight
accomplished
41 Myojo Foods Japan 2006 Steel Partners 23,1 buyout of company takeover bid failed white-knight bid from Nissin Food Products 42 Noritz Japan 2007 Fursa Alternative
Strategies
No. Target company Country target Year Insurgent 1 Insurgent 2 Stake Goals and reasons of attack Methods Results Cause of failure
43 Northwest United States 2006 Owl Creek Asset
Management Marathon Asset
Management
23 block Northwest's bankruptcy reorganization plan lawsuit, plea to sell company instead of
rescue
failed
44 Osi Restaurant Partners United States 2006 Pirate Capital 5,3 sale of some businesses due to bad performance public pressure failed shares dropped, sale became
impossible 45 PDL BioPharma United States 2007 Third Point 7,5 rezignation of chairman and CEO due to high
undisciplined spending, underperformance of stock
requesting
46 Pentax Japan 2007 Sparx Asset Management 23,98 better return for shareholders or takeover by Hoya pressure, negotiation accomplished 47 Pep Boys United States 2006 Barington Capital Group others 9,9 improve stock performance by adding four proposed
directors to board
threaten with proxy fight accomplished 48 Phelps Dodge United States 2006 SAC Capital Partners 5,1 block buyout of company by Freeport-McMoRan
Copper & Gold, price too low
vote against in EGM failed lack of shareholder support 49 Phelps Dodge United States 2006 Atticus Capital 9,9 block the offer for Inco & Falconbridge, return of capital
is better
vote against in EGM accomplished 50 Rural/Metro United States 2006 Accipiter Capital
Management
7,7 increase shareholder value, even if achieved by sale of
company. get two own board
members
51 Sapporo Holdings Japan 2007 Steel Partners 18,64 buyout of company takeover bid, negotiation 52 Sotoh Japan 2004 Steel Partners 12,3 increase shareholder value by buyout of company bidding war partly
accomplished
53 Sovereign Bancorp United States 2003 Relational Investors 8 get control because of dissatisfaction about company's
equity sale of 19,8% to Spain's Grupo Santander, bad
stock performance
proxy fight and legal
fight
accomplished
54 Stork Netherlands 2006 Centaurus Capital Paulson & Co 30 refocus business by sale of divisions pressure, firing and replacing board partly accomplished 55 Teesland United Kingdom 2006 Polygon Investment Management
24,9 to get higher price for company by SCAMP, or maybe to remain a minority shareholder of the new profitable
SCAMP company not selling shares to
SCAMP 56 Telent United Kingdom 2006 Polygon Investment Management
23,9 block buyout of company by Fortress, maybe bid too low proxy vote accomplished 57 Time Warner United States 2005 Icahn others 3,1 reorganize company for creating shareholder value,
increase share buyback program, divestiture of cable division
proxy fight for new board, gaining control in
company partly
accomplished
58 Triad Hospitals United States 2006 TPG-Axon Capital
Management
8,9 improve stock performance, improve ability for financial
analysis regarding margins, bad debt, ROI threaten with proxy fight
to replace directors
accomplished 59 Valeo France 2006 Pardus Capital
Management
5 get board to make review of all strategic options pressure, nomination of 8 new board members,
two of its own
failed lack of shareholder support in
ASM 60 Versatel Netherlands 2005 Centaurus Capital others 13,6 block buyout by Tele2, bid too low legal fight failed court decision ruled in favour of
a reversed acquisition (Versatel
bought Tele2) 61 VNU Netherlands 2005 Knight Vinke Asset
Management Templeton Global
Advisors
48 block $6.3 billion plan to buy IMS Health Inc threaten to vote against
bid
accomplished 62 VNU Netherlands 2005 Knight Vinke Asset
Management Fidelity Investments
(investment company)
7
No. Target company Country target Year Insurgent 1 Insurgent 2 Stake Goals and reasons of attack Methods Results Cause of failure
64 Warnaco United States 2006 Barington Capital Group 5,6 enhancing shareholder value, reducing expences,
possibly sale of company
pressure 65 Wella Germany 2003 Elliott Associates 9 get a higher price for the nonvoting shares of the
company in the buy-out by Procter & Gamble
lawsuit accomplished 66 Wendy's United States 2006 Trian Fund Management 5,5 to sell all operations except core business, to get three
board seats of Wendy's
pressure accomplished 67 Woolworths United
Kingdom
2005 Elliott Associates 6,7 divest businesses and return cash to shareholders after
collapse of the 837 million pounds bid from Apax
pressure accomplished 68 Wyevale United
Kingdom
2005 Laxey Partners Millennium Partners 39,8 remove chairman and two non-executives due to lack of confidence in restructuring ability, install Robert Ware as chairman
vote in EGM partly
accomplished
69 Yushiro Chemical
Industry
Japan 2003 Steel Partners 8,9 improve stock price, increase dividend bid for takeover of
company partly
accomplished
