Greenwich Time – In the buttoned-up world of Wall Street, some of the most entertaining reading emerges from the regulatory filings of hedge fund activists.
Take the recent musings of Stamford-based Dolphin Limited Partnership in its unsuccessful quest to oust infoUSA Chief Executive Officer Vinod Gupta. Bring “down to earth your larger than life chairman,” read one of Dolphin’s demands to the Nebraska database company’s board.
Other Dolphin correspondences used phrases such as “simply gibberish” and showed a penchant for the exclamation point.
While filings such as these provide amusing reading, they also mean serious business — not just for the authors trying to eke out greater shareholder value from their portfolio companies, but for the chief executives and board members who find themselves on the other end of the firing line.
Activism, through which many fund managers seek to effect changes in corporate management to boost share price, is becoming as commonplace a strategy as the traditional hedge fund tactics of short selling, arbitrage or commodity betting.
Even some of Wall Street’s more traditional players are taking part. Stamford-based UBS Investment Bank, headed by Ken Moelis, who built his reputation by buying and selling companies, has begun advising hedge funds on hostile takeovers.
