Volcano Corporation (VOLC): Camber Capital Takes 9.81% Stake

Stephen Dubois’ Camber Capital Management has disclosed in a regulatory filing with Security and Exchange Commission a stake of 9.81% in medical equipment company Volcano Corporation (NASDAQ:VOLC). The investor has bought additional 1.9 million shares, increasing its holding in the company to 5.05 million. The current stake has a market value of $57 million. According to the investor’s most recent 13F filing, Dubois is managing an equity portfolio worth $1.5 billion and invests primarily in healthcare companies.

Volcano Corporation (NASDAQ:VOLC)

Camber, in a rare activist move, has announced that it may engage in discussions with Volcano Corporation (NASDAQ:VOLC)’s management and the board on a range of matters, including “potential business combinations and strategic alternatives, and the business, operations, governance, management.” This way it is joining  Glenn W. Welling‘s Engaged Capital in pressing the company to increase shareholder value.  Less than two weeks ago Engaged, which owns a stake of 5.1%, has written a letter to the board of directors asking the company to search for a new CEO threatening to unseat at least three directors.  It is very likely that Camber will ask the company to sell itself.

Volcano Corporation (NASDAQ:VOLC) has lost about 47% of its value since the beginning of the year and has become a target for activist investors, which are seeking poor performing companies, take stakes in them and try do directly influence their target to take steps to increase shareholder value. Volcano Corporation (NASDAQ:VOLC) is a classic example of that as it is one of the worst year-to-date performers in the market, missing on a constant basis analyst’s expectations for earnings. Last year Volcano Corporation (NASDAQ:VOLC) turned to a loss.

In addition to Engaged and Camber, Stephen Raneri’s Lioneye Capital Management holds 2 million shares that are worth $33 million and Israel Englander’s Millenium Management owns 714,242 shares that are priced by the market at $12.5 million.

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