Jeffrey Ubben is dialing back his involvement in making key
investment decisions at ValueAct Capital Management. He has
named president Mason Morfit as chief investment officer,
responsible for making final investment decisions, according to
a Wall Street Journal report.
The move is part of a succession plan. Ubben, who will
remain chief executive officer, is 54, while Morfit is 41.
Ubben told the paper he did not want ValueAct, which was
founded in 2000, to suffer the same fate that caused his
father’s firm to collapse following the departure
of its founders. "This is not something you can do at the end
of your term," Ubben said. "This is something you have to do
well in advance. When I’m sitting on a talent like
Mason, I’m just not going to let him go, and Mason
is going to want to evolve."
Ubben’s father, Timothy Ubben, co-founded
Lincoln Capital Management, an investment management firm that
once hit $50 billion in assets. ValueAct was an early investor
in Valeant Pharmaceuticals International and played a major
role in its growth plan, before the drug maker’s
share price collapsed over the past year or so. Morfit has sat
on the board of Valeant as well as Microsoft, a very successful
ValueAct gained 4 percent last year,
surging more than 12 percent in the second half of the year.
The firm, which manages about $16 billion, announced earlier
this year it would return some capital to its investors.
Starboard Value took a large new position
in Fortinet, a major cyber-security company, in the first
quarter. Starboard, the activist firm headed by Jeffrey Smith,
disclosed it owned a $160 million position in the company,
making the stock its sixth-largest holding, according to a new
This is very intriguing. Certainly, there is heightened
interest in cyber-security in general these days. However, as
we have chronicled many times in the past, it is very unusual
for Starboard or other major activists to telegraph future
Of course, there is no reason to believe Fortinet will
become an activist target of Starboard. The stock on Monday
rose about 3.4 percent, to close at $40.45, and is now up about
28 percent for the year to date. It has also more than doubled
from its November 2013 low. This will be an interesting one to
Philippe Laffont’s Coatue Management reported it owned nearly
21 million shares of Snap, the high-profile social media
company that went public earlier in the quarter, making the
stock the Tiger Cub’s seventh-largest U.S. long
holding. Coatue was one of several hedge funds that made a
sizable bet on the company when it was private. Altogether,
Coatue boosted the value of its U.S. stock portfolio in the
past quarter by about 25 percent, to $10.4 billion.
Glade Brook, the hedge fund firm that aggressively morphed
into a venture capital firm late last year, said it owned
nearly 4.7 million shares of Snap, its only reported U.S. stock
holding. As we have reported several times, Glade Brook made
several investments in Snap when it was private.
Shares of Snap surged about 8.4 percent, to close at
Leon Cooperman’s Omega Advisors aggressively traded its
portfolio in the first quarter. But the changes did not
meaningfully affect the composition of its U.S. stock holdings,
according to its latest required regulatory filing. Omega
established 31 new positions and liquidated 18. Altogether it
held 84 different individual U.S. stocks. None of its new
positions, however, rank among its top-ten holdings and just
two are among its 25 largest positions.
Tiger Global Management tinkered with each of its three
largest U.S. long holdings, which collectively account for more
than 40 percent of its portfolio. It trimmed No. 1-holding the
Priceline Group by 15 percent and reduced its stake in No.
3-holding Amazon.com by 2 percent. It slightly added to its
stake in JD.com.
Luxor Capital Partners continues to
rebound from its woes of last year, when it lost some
high-profile investors. It rose 1.82 percent in April, boosting
its gain for the year to 11.35 percent.
The event-driven firm, headed by Christian Leone, earned
gains in April from food delivery phone app GrubHub, Spanish
infrastructure giant Ferrovial — a new position
— and Mindbody, which makes cloud-based business
management software. Gains for the four months were driven by
Mindbody, GrubHub, and three energy companies: Golar LNG,
C&J Energy Services, and Basic Energy Services. Luxor,
which manages $3 billion, was down 9 percent in 2014 and 18.3
percent in 2015 and lost another 5.2 percent in January 2016
before rebounding sharply and finishing the year up 12.2