According to a recently amended 13D filing, Clifton S. Robbins’ Blue Harbour Group continues to up its bet on Rowan Companies PLC (NYSE:RDC). Since we last reported an increase in its stake in late-July, the fund acquired 1.75 million Class A Ordinary Shares, for prices ranging from $26.58 per share to $31.03 per share. It now owns 9.78 million shares of the company, which represent 7.9% of its outstanding Class A Ordinary Shares, up from 8.03 million disclosed in late-July, and 5.03 million held by the end of the second quarter of 2014.
Rowan Companies PLC (NYSE:RDC) is a $3.15 billion market cap provider of offshore oil and gas contract drilling services, utilizing a fleet of 30 self-elevating mobile offshore “jack-up” drilling units and four ultra-deepwater drillships. The stock trades above its peers’ average valuation, at 16.8 times the company’s earnings, but still looks somewhat attractive, especially when the –recently reinstituted- 1.56% dividend yield (and its room for further growth) is taken into account.
In addition to Clifton S. Robbins’ Blue Harbour Group, which is the largest hedge fund shareholder (amongst those we keep track of) in Rowan Companies PLC (NYSE:RDC), other major funds are betting on this drilling company. For instance, First Pacific Advisors LLC, run by Robert Rodriguez and Steven Romick, last disclosed (for the second quarter) ownership of 4.7 million shares, while Israel Englander’s Millennium Management declared holding 3.01 million shares, worth almost $100 million.
Blue Harbour Group is a –usually- activist hedge fund founded in 2004, and run by Clifton S. Robbins ever since. According to the fund’s website, “Candidates for investment must be well-managed, high-quality businesses that are fundamentally undervalued and trading at a discount to intrinsic value. They must possess favorable industry dynamics, sustainable franchises and recurring free cash flow business models.”
For the second quarter of 2014, Blue Harbour Group disclosed an equity portfolio worth more than $2.5 billion. Since the end of the period, the fund boosted its stakes in two other companies, apart from Rowan Companies PLC (NYSE:RDC). In early-August, it raised its exposure to Rackspace Hosting, Inc. (NYSE:RAX) and Investors Bancorp, Inc. (NASDAQ:ISBC). It now owns 9.09 million shares and 20.46 million shares, respectively.
Disclosure: Javier Hasse holds no positions in any stocks or funds mentioned
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