This Week's Activist Filings

By Sham Gad | December 29, 2011 AAA

As the year wraps up, investors are not taking the foot off the pedal when it comes to filing 13Ds. All the recent concerns about Chinese small caps did not prevent private equity firm Warburg Pincus from adding on to its sizable stake in China Biologic (Nasdaq:CBPO), a maker of plasma based pharmaceutical and other related products. Warburg owns over 6 million shares, or over 24%. (For related reading, see Digging Into 13D Disclosures.)

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Icahn's Newest Drama
Carl Icahn is back in the middle of an activist tussle after his publicized attempt to seize control of consumer products company Clorox (NYSE:CLX) failed. This time, the situation involves trucking and defense products manufacturers Navistar (NYSE:NAV) and Oshkosh (NYSE:OSK). Icahn happens to be a large shareholder in both companies. Yet hedge fund Owl Creek Asset Management, which owns 8.5% of Navistar, has publicly expressed concern over the possibility that Icahn would want to combine Navistar and Oshkosh. Share prices in both companies have been hit hard over the past year as concerns about defense spending and the overall economy have caused investors to abandon the businesses. Navistar shares trade for around $37, down from a high of above $70, while OSK shares are down from a high of about $40 to roughly $22 today.

Activist Investors
With the year ending on a somewhat positive note economically, 2012 will likely be a fertile year for activist investors. Investors will want to keep an eye on what happens in this sphere of investing. In additions to Icahn's endeavors, investors will want to follow the fortunes of retailer JC Penny (NYSE:JCP) and Canadian Pacific Railway (NYSE:CP), two targets of activist Bill Ackman. JC Penny recently signed a deal with Martha Stewart Living Omnimedia (NYSE:MSO) while Canadian Pacific made two new appointments to its Board. Both companies are clearly embracing change and that is usually a positive sign for shareholders.

The Bottom Line
With Europe's woes still casting a cloud of uncertainty going into 2012, stocks embraced by activists can be fertile opportunities regardless of market performance. (To learn more, check out Activist Investors: A Good Or Bad Thing?)

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At the time of writing, Sham Gad did not own shares in any of the companies mentioned in this article.

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