activist hedge fund company Starboard Value's methodologies, assignment help

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I want you to research activist hedge fund company Starboard Value's methodologies (I've provided some valuable links below) and to find a company that you think is a prime target for major restructuring like Yahoo and Olive Garden (two of Starboard's more recent and famous takeovers.) APA format 6-7 pages.

1. Research and discuss Starboard's criteria and methodology. How do they select a company? What are its criteria? How do they go about their process of exerting control over the company.

2. You are a Senior Analyst working there. Find and investigate a potential company you think would be a suitable target for Starboard. What characteristics make the target company a good candidate based off your research? Conversely, what might make them not such a good candidate?

3. Assuming you gained a strong position in the company's equity, what problems do you see with the company that need to be overcome. What corrective actions would you suggest the company make?


Check out this very detailed article on Starboard Value and Jeff Smith, CEO.

How Starboard has Shaken Up Corporate America

This article details the turnaround experienced by Olive Garden, partially thanks to activist hedge fund Starboard Value. Please read this article for a background on how it went down.

You can read more about the company at their website. Make sure to check the biographies of senior management.

This video shares John Oliver's hilarious take on Starboard Value's attempt to takeover Olive Garden's board.

User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

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In 2014, Jeff Smith, CEO of Starboard Value, was named as the most dreaded man in
corporate America. Established in 2011 as an autonomous firm, having spun out of Ramius LLC,
Starboard concentrates on purchasing underestimated companies (Cornish, 2016). Smith and his
group see an unmistakable open door and pathway to improve shareholder esteem through
activist engagement.
Starboard Value LP Performance
From July 2011 to January 2016, reproduced returns, in light of Starboard's 13F filings,
beat the S&P 500 in total by more than 30%, proposing important alpha produced on the long
side on an earned up premise (Cornish, 2016).

AUM
Amid this period, resources under management seem to have expanded significantly in
light of a move from under $200 million in announced 13F long positions to a pinnacle of over
$3 billion (Ross, 2016).

Concentration

The ten best positions have portrayed in the range of 71% and 90% of simulated exposure
over this period, with a median of 88%, demonstrating that the firm has retained an exceptionally
focused portfolio (Ross, 2016).

Showcase Cap Exposures
In mid-2011, the 13F portfolio held vast exposure to both miniaturized scale and smallcap stocks. At the beginning of 2014, the small-cap top had decreased altogether, and the firm
had expanded its focus to mid-caps (Ross, 2016). In 2014, mid-caps focus went up to represent
the dominant part, although large-cap exposure was introduced towards the end of the year. In
2015, the fund had a significant interest in all the three levels of exposures: small-cap, mid-cap,

and large-cap. The portfolio's dynamic increment in the market is demonstrated in the graph
underneath.

Starboard "Engages With Management Teams," To Put It Lightly

Starboard invests in companies that are greatly undervalued and seek to work with the
board of directors as well as the managers to spot and build on available opportunities for the
general growth of the company (Cornish, 2016).
Yahoo
In 2016, the most significant conflict in Starboard’s history was with Yahoo and its then
serving CEO, Mayer Marissa (Turong, 2016). The conflict centered on yahoo’s weak business
model. This led to Starboard releasing a rather strongly worded letter registering its
disappointment with Yahoo’s weak business model. Smith was quoted stating that if the board
was not willing to embrace change for the growth of the company, then the need to replace them
was inevitable.

In the close of 2015, Yahoo had resolved to sell its shares in Alibaba (Melin, 2016).
Starboard was very disappointed with that decision. Yahoo’s argument that the move would not
cost tax and it was for the general benefit of all stakeholders. More than ever, Starboard was
disappointed and demanded rapid changes in the company’s board. Smith even took the
argument on the media attacking and criticizing the board of Yahoo.
Starboard sought out to gain the shareholders’ votes to replace the yahoo’s board in its
entirety. In March the following year, starboard wrote an open letter to the shareholders
criticizing the board of Yahoo and rallied for its replacement. The company was able to so spinoff its stake in Alibaba as well as its core business (Turong, 2016). Starboard used the tactic of
shareholder involvement to replace the board to achieve its objective.
Starboard and Macy
As Smith was involved in a push and pull with Yahoo, he was also pressuring Macy to
dispose of its real estate holdings so as to improve its income. Starboard wrote a public letter to
persuade Macy to opt for a partnership on its real estate holdings (Levine-Weinberg, 2016).
Starboard felt that fifty percent undervalued the company's real estate. Attached were the figures
of their previous summer sales tha...


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Really great stuff, couldn't ask for more.

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