CEO, announces partner departures, strong gains -letter

JSR

04/08/2023 20:00

By Svea Herbst-Bayliss
       NEW YORK, Aug 4 (Reuters) - ValueAct Capital is
reordering its management team and promoting long-time partner
Robert Hale to co-chief executive alongside Mason Morfit as the
investment firm focuses more heavily on Japan and wants to
simplify its own organization.
    At the same time, ValueAct told investors in a letter seen
by Reuters that three partners, including the firm's president
Brandon Boze, are leaving. Boze will retire from the firm in
2024 and partners Dylan Haggart and Sarah Coyne will leave.
    After posting a 20% gain in the first half of the year and
beating the S&P 500 index, ValueAct said investors are facing "a
new market regime." The firm said it made changes internally to
"miss fewer opportunities, and reduce our mistakes." 
    ValueAct, which has pushed companies ranging from Microsoft
to Salesforce to change, wrote that it applied the "blank sheet"
approach it urges target companies to adopt for itself.
    The moves mark the biggest changes at San Francisco-based
ValueAct since 2020 when Morfit took over as CEO after the
firm's founder, Jeff Ubben, stepped aside and eventually left.
    Morfit, 45, who arrived as an analyst at ValueAct two
decades ago, picked Hale, 38, as his co-CEO after a decade of
working closely together with Morfit running the global Flagship
Fund and Hale taking primary control of ValueAct's new Japan
Fund, launched earlier in 2023.
    Hale has served on two Japanese companies' boards: chip
maker JSR, which last month agreed to go private, and optical
and digital precision technology company Olympus. ValueAct also
pushed to replace four Seven & i Holdings directors with its own
candidates this year, a campaign rejected by shareholders.
    "Rob has built what we believe is the premiere engagement
investing franchise in Japan," the letter said.
    ValueAct said it has been working on these changes for
months. "Our goals are to reduce volatility and apply insights
more quickly."
    Haggart, who will remain a director at Fiserv and Seagate,
is leaving as he wants to manage his own investment portfolio,
the letter said. ValueAct said Coyne identified long-term super
cycles as the market reached to short term datapoints.
    ValueAct made headlines earlier this year when Morfit was
appointed to the board at cloud computing company Salesforce
which was facing pressure from four activists, including
Starboard Value, Elliott Investment Management and Ubben's
Inclusive Capital. Performance has improved and the stock price
has climbed 60% since January.
    ValueAct's investments in Salesforce, Spotify, the New York
Times and Insight, were built during last year's stock market
collapse and have contributed to this year's strong returns. 
     

 (Reporting by Svea Herbst-Bayliss
Editing by Nick Zieminski)
 ((svea.herbst@thomsonreuters.com; +617 233 2138; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))