David Nierenberg’s Nierenberg Investment Management Likes Osmium Partners’ Decision To Go Activist

In a newly amended filing, Nierenberg Investment Management, led by David Nierenberg, disclosed that it welcomes John H. Lewis’ Osmium Partners’ decision to convert its stake in Rosetta Stone Inc. (NYSE:RST) to activist from passive. According to the filing with the U.S. Securities and Exchange Commission, Osmium Partners changed its filing status for its 9.95% stake in the company to activist from a after the end of trading on August 21.

Nierenberg Investment Management owns 1.69 million shares of Rosetta Stone Inc. (NYSE:RST), which is equal to 7.9% of outstanding common stock. In the filing, the hedge fund stated that it likes Osmium Partners’ conversion to active engagement in Rosetta Stone Inc. (NYSE:RST) for several reasons, including the fact that Osmium Partners focuses on internet commerce, social media, and digital marketing, where it has a deep expertise. In a recent filing, Osmium Partners reported ownership of 2.13 million shares of Rosetta Stone Inc. (NYSE:RST)’s common stock.

Further, the hedge fund of David Nierenberg notes that Osmium Partners is now more actively engaging with a number of their portfolio companies.

“This summer their activism produced substantial change and stakeholder benefit at three of their portfolio companies: The Kroger Co. (NYSE:KR) offered to buy Vitacost.com Inc. (NASDAQ:VITC), where Osmium had placed a colleague on the board of directors; Realogy Holdings Corp (NYSE:RLGY) offered to acquire ZipRealty Inc. (NASDAQ:ZIPR), where Osmium had filed a 13D and worked to maximize stakeholder value; and Osmium’s slate of four directors won 88% of the votes cast for election to the board of Spark Networks Inc. (NYSEMKT:LOV) and the board changed the focus and executive leadership of the company,” Nierenberg Investment Management added.

Moreover, Nierenberg Investment Management said that it expects that Osmium Partners might bring similar passion, urgency, energy, and impact to matters of corporate governance, focus, and execution at Rosetta Stone Inc. (NYSE:RST).

Rosetta Stone Inc. (NYSE:RST) is engaged in providing technology-based language-learning, reading and brain fitness solutions. The market value of the company is $190.2 million. On Tuesday, shares of the company traded down by 0.67% to $8.87. Analysts have the consensus average target price of $13.00. The consensus average recommendation is ‘Overweight’.

Disclosure: none