Activist investor Eliott Management, of Emulex fame, always pushes to have its voice heard - especially when it thinks bosses of its "investment companies" don't put shareholders first. Now the fund has actually taken on storage giant NetApp. According to a Bloomberg report, Elliott is pushing NetApp to change its board. We can …
Do more to harm consumers and degrade product offerings than any single factor I can think of. I'm always wary when a business entity comes along and proceeds to tell a widget company how to build a better widget through accounting.
I've been part of the senior management team through wo IPO's and I've seen the damage that investors can do to the companies they invest in. Now that I'm on my own I plan never to deal with outside investment again.
Re: Activist Shareholders
Agreed. Although sometimes you need shareholders to stand up and hold a board to account, if the board's not acting in the best interests of the company and its longevity. Except that's the kind of shareholders that are a) knowledgeable and b) interested in a *fair* return on their investment over a period, not a maximum return in as short a period as possible.
An awful lot of 'investors' seem to have forgotten that the idea is to help a company survive and grow, to mutual benefit, rather than to trouser as much as possible then move on just before the train wreck to the next opportunity.
Re: idea is to help a company survive and grow
No such idea is implied when a shareholder invests. If you want to invest that way, that's your choice. If I want to invest for the best rate of return and move my money elsewhere when a company isn't giving it to me, that's my choice.
Where I see a problem is that corporate raiders do exist, and of late too many of them have wound up in charge of investment funds where they have leveraged other shareholders who might not otherwise agree with their strategy. Or in the context of my opening paragraph, even if my investment strategy yields more dollars than yours does, I shouldn't be able to force you to adhere to my investment strategy.
But when they bring their cash...
Interestingly enough, I never hear the companies or their boards complaining about Shareholders when they invest large chunks of money into their company. They then call them "forward thinking", "early adopters", "industry experts", "visionaries", etc....
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