Orange Capital Raises Activist Stake in PHH Corporation (PHH)

Orange Capital, a hedge fund managed by Daniel Lewes, has upped its stake in PHH Corporation (NYSE:PHH). Orange disclosed an activist position which amasses 3.54 million shares of the company, equal to 6.0% of the common stock. The stake has been upped from 5.0% of common stock, equal to 2.87 million shares.

PHH Corporation

At  the same time, Orange disclosed that it discussed with the management of the PHH Corporation (NYSE:PHH), focusing on several points such as the use of $300 million of excess cash held by the company and strategies related to a tax-efficient sale or spin-off of PHH Corp’s Fleet Management Business, among other things. These measures, from Orange Capital’s point of view can increase the shareholder returns of the company. The fund will continue its discussions with the board, the filing also stated.

The fund has initiated its stake in the company in September, through acquiring around 2.87 million share, equal to 5% of the common stock. Daniel Lewis sent two letters to the company‘s CEO, Glen Messina suggesting moves that could increase PHH’s shareholder value such as initiating a share repurchase program or the spin-off of the fleet management business.

PHH Corporation (NYSE:PHH) is a provider of mortgage and fleet management services operating in three segments: Mortgage Production, Mortgage Servicing and Fleet Management Services. The company provides services throughout the United States through its subsidiaries. Apart from Orange Capital, Doug Silverman and Alexander Klabin managed Senator Investment Group had invested nearly $95 million through 4 million shares in the company at the end of the third quarter. John Osterweis’s Osterweis Capital Management has also disclosed holding of 2.69 million shares worth $65 million at the end of the third quarter.

Disclosure: none

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