Jeffrey Ubben’s Valueact Capital Management disclosed today an increase in its exposure to Valeant Pharmaceuticals Intl Inc (NYSE:VRX). The fund added 5,022 shares to its holdings, which now amount to almost 18.93 million shares of Common Stock, worth almost $2.4 billion. This stake accounts for 5.6% of the company’s shares outstanding, and makes of Valueact Capital the largest institutional shareholder at the company, amongst those that we keep track of.
Additionally, on September 25, 2014 Valeant Pharmaceuticals Intl Inc (NYSE:VRX) announced that Jeffrey Ubben has been appointed for its Board of Directors, effective as of October 1, 2014. In the filing, the fund also states its intentions to continue to add to its holdings in the company, depending on market conditions.
The 5,022 shares added to the fund’s holdings are actually Restricted Stock Units obtained directly from Valeant Pharmaceuticals Intl Inc (NYSE:VRX) as compensation for Valueact’s principals’ service on its Board of Directors.
As we reported earlier today, the fund also disclosed a reduction in its activist position in Rockwell Collins, Inc. (NYSE:COL). According to its latest filing, ValueAct owns around 11.19 million shares of the company, down from 12.01 million disclosed in the latest 13F filing. The position amasses 8.3% of in Rockwell Collins, Inc. (NYSE:COL) outstanding common stock. Learn Why Jeff Ubben’s VA Capital Reduced Its Stake in Rockwell Collins, Inc. (NYSE:COL) here.
Other major hedge funds betting on Valeant Pharmaceuticals Intl Inc (NYSE:VRX) are Andreas Halvorsen’s Viking Global and Stephen Mandel’s Lone Pine Capital. Viking Global last disclosed (for the second quarter of 2014) ownership of 11.8 million shares, following a 28% increase in its stake over the second quarter; Lone Pine Capital acknowledged holding 10.8 million shares by the end of the period, which implies a 15% increase in its stake. Their positions are worth more than $1.4 billion and $1.2 billion, respectively.
Valeant Pharmaceuticals Intl Inc (NYSE:VRX) is up more than 3% today, on the news of Mr. Ubben being appointed to the Board. According to a PR Newswire, Ubben said that
“Valeant has been an important component to ValueAct’s success over the past seven years and we strongly believe in Valeant’s business model and strategy. Valeant has become significantly undervalued on a standalone basis due to recent unjustified attacks on the company. We are strongly supportive of the Allergan-Valeant combination in light of their perfect strategic fit and the potential to create enormous shareholder value for both companies.”
As the stock price continues to rise, Valeant Pharmaceuticals Intl Inc (NYSE:VRX)’s possibilities of acquiring Allergan, Inc. (NYSE:AGN) also grow. The company has offered to pay Allergan shareholders $72 in cash and 0.83 shares of Valeant stock for each Allergan, Inc. (NYSE:AGN) share they hold. As we reported yesterday, Pershing Square Capital Management’s Bill Ackman sent a letter expressing his indignation with the Board refusing to offer the shareholders the right to vote regarding the Valeant acquisition and, instead, considering a highly leveraged acquisition, that of Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP), without asking the shareholders for their consent.
Disclosure: Javier Hasse holds no positions in any stocks or funds mentioned
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