Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Msci Inc (MSCI) Agrees To Appoint ValueAct Capital’s Representatives To Board

A new filing with the U.S. Securities and Exchange Commission disclosed that Msci Inc (NYSE:MSCI) entered into a cooperation agreement with Jeffrey Ubben’s ValueAct Capital to appoint three new members to its board of directors. Msci Inc (NYSE:MSCI) has agreed to appoint D. Robert Hale, a partner at ValueAct Capital, as well as Wendy E. Lane and Wayne Edmunds to the company’s board. ValueAct Capital is one of the largest shareholders of the company. According to the filing, the fund owns around 9.31 million shares, equal to 8.3% of the company’s common stock outstanding.


San Francisco-based ValueAct Capital is a 14-year old activist hedge fund with net annual gains of 17 percent. Founded by Jeff Ubben, the hedge fund has $14 billion under management. Mr. Ubben is a former managing partner of Richard Blum’s Blum Capital Partners. ValueAct Capital has a long-term focus, taking very concentrated positions and holding on to them for several years. In the October issue of Insider Monkey’s monthly newsletter we analyzed the performance of Ubben’s stock picks that are disclosed in 13F filings. Our analysis revealed that imitating Ubben’s positions would have outperformed the market by nearly a percentage point per month. The results were even better between 2008 and 2012. Ubben stock picks outperformed the S&P 500 index by nearly 1.5 percentage points per month. There are very few fund managers who demonstrated similar talent in beating the market. That’s why we closely track Ubben’s stock moves. Jeff Ubben actively seeks for changes to put companies in the right direction. He usually pursues representation on the companies’ boards. Over the last years, the fund’s representatives were appointed to over 25 companies, including Microsoft Corporation (NASDAQ:MSFT) and Valeant Pharmaceuticals Intl Inc (NYSE:VRX) among others.

Three largest holdings of ValueAct Capital include Microsoft Corporation (NASDAQ:MSFT), Valeant Pharmaceuticals Intl Inc (NYSE:VRX), and Motorola Solutions Inc (NYSE:MSI). As of the end of the third quarter of 2014, the fund held 74.24 million shares of Microsoft Corporation (NASDAQ:MSFT), 18.92 million shares of Valeant Pharmaceuticals Intl Inc (NYSE:VRX), and 28.91 million shares of Motorola Solutions Inc (NYSE:MSI).

Under the agreement, Msci Inc (NYSE:MSCI) will appoint Mr. Hale to the company’s board for election to the board at the company’s 2015 annual meeting of shareholders. The company has agreed to appoint Ms. Lane and Mr. Edmunds as independent members. At the same time, ValueAct has agreed to vote in favor of the company’s nominees to the board at the 2015 annual meeting. In addition, ValueAct has agreed that it will not acquire any beneficial or other ownership interest of 14.9% or more of the company’s common stock outstanding at such time.

In the beginning of last month, ValueAct Capital disclosed a letter it sent to the Lead Director of Msci Inc (NYSE:MSCI) Rodolphe M. Vallee. In the letter, Mr. Ubben expressed his frustration with the board not proceeding with the fund’s request to appoint their representatives. The investor mentioned that the company’s Risk Management Analytics and Portfolio Management Analytics segments have a great potential and strong competitive positions, but they have not show a significant market share growth. According to letter, the investors’ questions have not been answered clearly neither in the publicly disclosed information, not in the discussions with the management, which made the investor consider seeking representation on the company’s board.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.