Jeffrey Altman’s Owl Creek Asset Management Concerns Navistar’s Potential Merger

Jeffrey Altman’s Owl Creek Asset Management files an SEC disclosure today regarding its recent issue with the management team of Navistar International Corp (NAV). Owl Creek Asset Management engaged in a conversation with the management of the issuer on December 9, and discussed about a potential merger and acquisition partner. The firm noted that the management “should consider among other things whether the potential merger partner’s construction and military segments would allow for the creation of sufficiently valuable synergies with the Company to merit such a transaction.” Owl Creek Asset Management claimed that it did not receive any material non-public information and made no conclusion. The filing also shows Owl Creek Asset Management now has 6.15 million shares in the stock, giving an 8.48% activist stake. The firm reported 6.10 million shares in the third quarter. Now NAV has lost 35% so far in 2011, and is currently trading at $37.08.

Jeffrey Altman did not mention the name of NAV’s potential merger partner, but Carl Icahn reported on December 7th that he would support a merger between NAV and Oshkosh Corp (OSK). (See the related news here)

There are several other hedge funds which also invested in NAV. Beside Owl Asset Management’s largest position, Carl Icahn’s Icahn Capital initiated a brand new position of 1.77 million shares in NAV during the third quarter. Jim Simons’ Renaissance Technologies increased its position by 46% and had 639 thousand shares at the end of September.

Owl Creek Asset Management, L.P. invests in the public equity and fixed income markets, including Healthcare, Financial, Technology, and other sectors. The firm implements a distressed equity strategy along with a capital-structure arbitrage strategy as hedging techniques. The firm had a 13F portfolio of more than $6 billion at the end of Q2.

Navistar International Corporation engages in manufacturing and selling “commercial and military trucks, buses, diesel engines, recreational vehicles, and chassis”. It operates in Truck segment, Engine segment, Parts segment, and Financial Services segment. The company mainly markets its products through dealers and distributors in the United States, Canada, Mexico, Brazil, Argentina, and India, according to Yahoo! Finance.