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Tsachy Mishal
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Tsachy Mishal is the Portolio Manager at TAM Capital Management Inc.. He is the author of the investment blog Capital Observer. http://www.capitalobserver.com/
My company:
TAM Capital Management Inc.
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Capital Observer
  • A Hint Of Activism At CA Technologies 0 comments
    Sep 12, 2011 11:28 AM | about stocks: CA

    CA Technologies put out a seemingly mundane press release late Friday announcing a new addition to the CA Board of Directors. The new board member is the former CEO of Swisscom and a Swiss citizen. The largest shareholder of CA also happens to be Swiss.

    Walter Haefner, is a Swiss billionaire, who sold his company to CA in 1987 and now holds approximately 25% of the shares. In 2001 he defended management when they faced a proxy battle from an activist shareholder. It would not be unreasonable to assume that this new Swiss board member is there because of Mr. Haefner.  Why after nearly 25 years is CA's largest shareholder looking for representation on the board?

    I attended a CA Investor Conference in late July, where the company announced some changes. As a shareholder I was happy to hear that management was done making large acquisitions, although I was surprised as it seemed out of character. It was a break from their previously stated strategy of making a few acquisitions a year. Combined with the new addition to the board it seems to me that CA must be feeling pressure. A decade ago CA was the third largest independent software company in the World and the company has woefully underperformed since. My best guess is that CA's largest shareholder is fed up, as most would be after nearly 25 years.

    Disclosure: I am long CA.

    Stocks: CA
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