Paul Singer’s Elliott Management has registered a first victory in its activist efforts with regard to CDK Global Inc. (NASDAQ:CDK). According to an amended filing with the Securities and Exchange Commission, the company has agreed to nominate two of Elliott’s candidates for election to its Board at its next annual shareholders meeting. Elliott Management holds some 10.6 million shares of CDK, which account for 6.8% of the company’s common stock, and have further economic exposure to another 2.5% of CDK’s common stock through various derivative agreements.
CDK Global Inc. (NASDAQ:CDK) has agreed to increase the size of its Board to ten seats and nominate two of Elliott Management’s candidates for election. In exchange, Elliott has agreed to vote for the Board’s nominees. The fund’s activist efforts were first made public in May through a letter, following months of private talks. Elliott Management wrote that the company was profoundly under-managed and urged its management to focus on improving margins, establishing a share buyback program, and exploring a potential sale of the company.
CDK Global Inc. (NASDAQ:CDK) reported its financial results for its fourth quarter of fiscal year 2016 on Wednesday, posting a profit of $58.3 million for the period. On a per-share basis, the company posted adjusted earnings of $0.49 on $542.2 million in revenue, surpassing Wall Street’s expectations. Analysts had projected $530.9 million in revenue and earnings of $0.46 per share. The stock ended the trading session at $58.55 per share, up by 25% year-to-date. At the end of the first quarter, 41 of the funds we track had CDK in their equity portfolios, up from 34 registered three months earlier.
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You can access the original SEC filing by clicking here.
Ownership Summary Table
| Name | Sole Voting Power | Shared Voting Power | Sole Dispositive Power | Shared Dispositive Power | Aggregate Amount Owned Power | Percent of Class |
|---|---|---|---|---|---|---|
| Elliott Associates | 3,395,200 | 0 | 3,395,200 | 0 | 3,395,200 | 2.2% |
| Elliott International | 0 | 7,214,800 | 0 | 7,214,800 | 7,214,800 | 4.6% |
| Elliott International Capital Advisors Inc | 0 | 7,214,800 | 0 | 7,214,800 | 7,214,800 | 4.6% |
