Activists Nelson Peltz And Paul Singer Disclose Their Latest Moves

As investors are gearing up for the highly anticipated interest rate hike, a number of moves reported by elite funds might have slipped under the radar. But they did not slip past us and in this article we’ll see what activist investors Nelson Peltz and Paul Singer have been up to lately.

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Paul Singer has stepped up his efforts from preventing the breakup of American Capital Ltd. (NASDAQ:ACAS), increasing Elliott Management economic exposure to the stock. As reported in a recently amended filing with the Securities and Exchange Commission, Elliott continues to directly hold approximately 12.2 million shares of American Capital, but has increased its economic exposure through a derivative agreement. As a result, the fund has economic exposure to roughly 10.3% of the common stock, up from the previous position that gave them exposure to 9.1% of outstanding stock.

American Capital announced a year ago plans to separate its business-development corporations operations, which manages the assets bought by the firm, from its asset management arm, which cashes in the fees from managing the assets. Company executives argued this move would allow for a better management of both businesses, but Paul Singer sees this as a “poison-pill” meant o “entrench” the management. He argues hare buybacks, cost cutting and another strategic review are better ways to increase shareholder value and sees the stock surging to $23 per share should the company take this road instead. Shares are currently trading at $14.25 apiece, down by 3% for the year.

At the end of the third quarter, roughly a third of American Capital Ltd. (NASDAQ:ACAS)’s outstanding stock has held by 36 elite funds, down from 38 at the end of the previous quarter. Jeffrey Tannenbaum, on the other hand, was buying the stock, increasing his position by 2% by the end of September. His fund, Fir Tree, reportedly holds 12 million shares valued at $146 million.

Nelson Peltz has also decided to boost one of his investments, namely his holding in Wendys Co (NASDAQ:WEN). As reported in an amended filing with the SEC, Peltz and his fund, Trian Parters, now hold an aggregate of roughly 56.8 million shares or 20.7% of the company’s common stock. Trian has also disclosed that Ed Garden, who represented the fund on Wendy’s board of directors, has stepped down and has been replaced by Matthew Peltz, the son of Nelson Peltz and a partner at the fund. Wendy’s board of directors has also been increased in size and Trian got Dennis M. Kass to serve as a director on its behalf.

Nelson Peltz has been a long stading shareholder of Wendys Co (NASDAQ:WEN), having first bought shares back in October of 1992. Having taken a severe battering during the 2008 credit crunch, the stock has slowly resumed an upward trend, but has not been a very solid performer so far this year. Shares are currently trading at $10.75, up by 18% year to date. In the most recent financial report, the company posted revenues of $464.6 million, down by 6.5% year over year, and a profit of $7.6 million or $0.04 per share.

During the third quarter, billionaire Ken Griffin has been looking to cut his exposure to Wendy’s, dumping 38% of his stake and leaving Citadel Investment Group with 3.2 million shares reportedly worth $27 million. Israel Englander was on the other side of the barricade, buying shares left and right. According to its latest 13F filing, Millennium Management holds a little over 1 million Wendy’s shares, up by 80% over the quarter. In general, top hedge fund managers have been shying away from Wendys Co (NASDAQ:WEN) during the third quarter, as the number of hedge fund long positions decreased to 26 by the end of September, from 38 at the end of June.

Disclosure: none.