Activist investor Elliott Management Corp has taken a stake in Principal Financial Group Inc and plans to push for changes at the life Insurance company, Bloomberg reported late on Sunday, citing sources.
The New York-based hedge fund is nearing a deal that will grant it seats on Principal Financial’s board and plans to launch a strategic review of the insurer’s portfolio that could include a sale of part of the business, the report said.
The companies did not immediately respond to requests for comment on the news.
Activist investors typically buy stakes in companies and then push their managements to make changes, such as buying back stock, selling poorly performing units, or restructuring the business. The most effective way for an activist to effect change is through representatives on the board of directors.
The size of Elliott’s stake in Principal Financial couldn’t be determined, according to the Bloomberg report.
Founded in 1977 by Paul Singer, Elliott managed about $41 billion in assets as of July 1, making it one of the largest and oldest hedge fund firms in the world. The multi-strategy firm has developed a formidable corporate activism unit led by Jesse Cohn.
Source: Reuters.com