- Shares of cloud-based software company Salesforce (CRM) gained 3% on news that the activist investor firm Elliott Management took a large stake.
- Elliott's move follows a position in Salesforce taken by hedge fund Starboard Value in October.
- Salesforce recently announced cost-cutting measures including reductions in its workforce and real estate footprint.
Salesforce (CRM) shares rose 3% on reports that activist investor Elliott Management took a multi-billion dollar stake in the cloud-based software firm.
Jesse Cohn, managing partner at Elliott, praised Salesforce as "one of the pre-eminent software companies in the world," and said that, after following it for two decades, he has developed a "deep respect" for co-CEO Marc Benioff and what he has built. Cohn added that Elliott looks forward to "working constructively with Salesforce to realize the value befitting a company of its stature."
Elliot joins another activist hedge fund, Starboard Value, which announced in October that it had taken a position in Salesforce, and called on the company to increase its margins. Starboard claimed that Salesforce has not taken advantage of its position as an industry leader. Elliott didn't indicate what plans it may have for the company.
The move comes less than three weeks after Salesforce said it was slashing its workforce by 10% and reducing its office space and real estate footprint in a cost-cutting move. Benioff explained then that the company had overhired during the COVID-19 pandemic tech boom, "leading into this economic downturn we're now facing."
Shares of Salesforce have fallen 28% in the last year.