Esterline Technologies Corp (ESL): First Pacific Advisors Amends Agreement With Company

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We wrote recently about Robert Rodriguez and Steven Romick‘s First Pacific Advisors LLC entering into an Agreement with Esterline Technologies Corp (NYSE:ESL), FPA Hawkeye Fund, and FPA Funds Trust, pursuant to which First Pacific Advisors LLC,  FPA Hawkeye Fund and FPA Funds Trust (collectively ‘FPA Parties’) granted not to purchase any more shares of Esterline Technologies before the current negotiations with the company end. These negotiations are related to the fund’s beneficial ownership of the company’s shares and certain governance concerns. ‘FPA Parties’ agreed not to purchase more shares before September 28, or until 72 hours after ‘FPA Parties’ releases notice confirming that the negotiations have finished.

First Pacific Advisors LLC has filed a new 13D filing iCon which reports about signing Amendment No. 1 to this Agreement, upon which ‘FPA Parties’ granted not to acquire more shares of the company before October 12, or until 72 hours after ‘FPA Parties’ releases notification affirming that the negotiations have ended. The fund’s stake hasn’t changed since the Agreement, hence it still consists of 3.69 million common shares, which represent 12.6% of the outstanding stock.

Esterline Technologies is a manufacturer of specialty products for aerospace and defense markets, running in three divisions: Advanced Materials, Avionics & Controls, and Sensors & Systems. The company’s stock is down by 5.1%, year-to-date. In its last financial report for the third quarter of fiscal 2016, Esterline Technologies disclosed EPS of $1.38 and revenue of $517.1 million, beating estimates of $1.28 and $490.37 million, respectively.

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At the end of the June quarter, ten investors from Insider Monkey’s database were long Esterline Technologies  (NYSE:ESL), down from 14 in the March quarter. Among bullish smart money managers were Thomas Ellis and Todd Hammer’s North Run Capital, with a position worth around $35.36 million, Ken Griffin’s Citadel Investment Group, which held $8 million worth of Esterline Technologies’ shares, George Hall’s Clinton Group, and Gavin Saitowitz and Cisco J. Del Valle’s Springbok Capital.

Some of the investors who dumped Esterline Technologies (NYSE:ESL) during the quarter contained Jim Simons’ Renaissance Technologies, which sold its position in the company valued at the end of March at $5.5 million, Jay Petschek and Steven Major’s Corsair Capital Management, which said goodbye to $4.46 million worth of the company’s shares, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Alec Litowitz and Ross Laser’s Magnetar Capital.

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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
First Pacific Advisors 0 3,690,744 0 3,690,744 3,690,774 12.6%
FPA Crescent Fund, a series of FPA Funds Trust 0 2,863,871 0 2,863,871 2,863,871 9.7%
FPA Global Opportunity Fund, a series of FPA Hawkeye Fund 0 125,459 0 125,459 125,459 0.4%
FPA Select Drawdown Fund 0 204,820 0 204,820 204,820 0.7%
FPA Select Fund, a series of FPA Hawkeye Fund 0 13,665 0 13,665 13,665 Less than 0.1%
FPA Value Partners Fund, a series of FPA Hawkeye Fund 0 20,574 0 20,574 20,574 0.1%
FPA Hawkeye Fund, a series of FPA Hawkeye Fund 0 83,561 0 83,561 83,561 0.3%
FPA Hawkeye-7 Fund, a series of FPA Hawkeye Fund 0 117,415 0 117,415 117,415 0.4%
J. Richard Atwood 0 3,690,774 0 3,690,774 3,690,774 12.6%
Steven T. Romick 0 3,690,774 0 3,690,774 3,690,774 12.6%
Brian A. Selmo 0 3,690,774 0 3,690,774 3,690,774 12.6%
Mark Landecker 0 3,690,774 0 3,690,774 3,690,774 12.6%

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Page 1 of 17 – SEC Filing








(Amendment No. 2)*




(Name of Issuer)

Common Stock, par value $0.20 per share

(Title and Class of Securities)


(CUSIP Number)

J. Richard Atwood

First Pacific Advisors, LLC

11601 Wilshire Blvd.

Suite 1200

Los Angeles,
CA 90025

(310) 473-0225

with a copy to:

Douglas A. Rappaport, Esq.

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

York, NY 10036

(212) 872-1000

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

September 27, 2016

of Event Which Requires Filing of Statement)



If the filing person has
previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the following box.  x

Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b)
for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting persons initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be
deemed to be filed for the purpose of Section 18 of the Securities Exchange Act of 1934 (Act) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes)

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