September 2, 2019 BARRON’S M11
13D Filings
Investors Report to the SEC
13Ds are filed with the Securities and Exchange Commission within 10 days of an entity’s
attaining a greater than 5% position in any class of a company’s securities. Subsequent
changes in holdings or intentions must be reported in amended filings. This material has
been extracted from filings released by the SEC from Aug. 22 through Aug. 28, 2019.
Source:InsiderScore.com
Activist Holdings
CAI International (CAI)
Weiss Capital filed an initial 13D at the
transportation and logistics company on
Aug. 23 and disclosed a stake of 987,716
shares, or 5.7% of those outstanding. Weiss
bought 270,590 shares from June 24 to
Aug. 22 at prices of $18.18 to $24.73 apiece.
Weiss said it bought the shares based on
the “belief that [CAI] has a strong balance
sheet with high quality assets, and that the
shares are undervalued and represent an
attractive investment opportunity.”
Weiss revealed that at the June 2019
shareholders meeting and in communica-
tions after that, it had “encouraged [CAI]’s
management and board of directors to
engage a recognized financial advisor to
assist [CAI] in conducting a full review...
including, without limitation, the possibil-
ity of selling all or substantially all of
[CAI] and/or its assets at a price reflect-
ing fair value for common shareholders.”
Weiss noted that CAI’s stock “histori-
cally has not reflected, and continues not to
reflect, [CAI]’s intrinsic value....At the
close of trading on Aug. 22, [CAI] repre-
sents an approximately 42% discount to
[CAI]’s $33.77 book value per common
share as of June 30.” Weiss added that it
intends to “continue its dialogue” with
CAI’s management and board of directors
on “steps to increase shareholder value.”
Dynavax Technologies (DVAX)
Bain Capital disclosed a position of
8,452,235 shares in the clinical-stage bio-
pharmaceutical company for a stake of
9.99%, including 927,235 shares issuable
upon the conversion of preferred stock or
warrants. Bain disclosed the new stake on
Aug. 22, pointing out that it initiated the
stake through the public offering by
Dynavax at the offering price of $3 per
share, together with a warrant.
On Aug. 12, Dynavax’s board appointed
Andrew Hack as a director. Hack is a man-
aging director of Bain Capital Life Sci-
ences. Bain said it “intends to take an ac-
tive role” in working with Dynavax’s
management and the board on “operational,
financial, and strategic alternatives.”
Progenics Pharmaceuticals (PGNX)
Velan Capital revealed that after the 2019
annual meeting, which resulted in two
board members resigning because they
didn’t receive a majority of votes, it contin-
ues to engage with Progenics to reach an
agreement on filling the two vacancies it
helped create. Despite Velan’s outreach, it
said the board “has been unreceptive to its
good faith efforts to reach a resolution.”
Velan added that if it continues to be
ignored, it will “hold this board account-
able by running a consent solicitation to
reconstitute the board.”
Velan holds 7,418,672 shares of the
oncology firm, or 8.6% of the outstanding,
after buying 1,391,472 shares from Aug. 5
to Aug. 26 at $4 to $4.78 per share.
Telenav (TNAV)
On Aug. 21, Nokomis Capital entered into
an agreement with Telenav, providing
Nokomis with a board seat. Nokomis
added that it will nominate Wes Cummins
to the board and that Telenav will recom-
mend that stockholders vote in favor of
Cummins.
As part of the agreement, Nokomis
entered into standstill restrictions until
the 2020 annual meeting of stockholders,
restricting Nokomis to customary stand-
still prohibitions, including proxy solicita-
tion and disparaging statements. Nokomis
held 4,794,205, good for a 10.2% stake in
the location services company.
Increases in Holdings
Fastly (FSLY)
Abdiel Capital Advisors lifted its stake in
the real-time content-delivery network to
3,895,982 shares, or 29.9% of the outstand-
ing. Abdiel’s latest filing disclosed the pur-
chase of 150,619 shares at per share prices
in a range of $19.59 to $24.73.
GCP Applied Technologies (GCP)
Starboard Value added to its position in
the construction-materials company
through the purchase of 296,556 shares
from Aug. 7 to Aug. 27 at $16.70 to $19
each. The addition increases Starboard’s
stake to 7.7%, or 5,610,000 shares.
HudBay Minerals (HBM)
Waterton Global Resource Management
increased its ownership in the Canadian-
based mining company through the pur-
chase of 2,639,046 shares from Aug. 1 to
Aug. 23. It effected the purchase at a price
range of $3.05 to $3.95 per share, giving it
ownership of 37,288,744 shares, or 14.3% of
the outstanding.
W&T Offshore (WTI)
Tracy Krohn, the CEO of W&T Offshore,
increased his ownership by 274,288 shares,
to 46,271,586 shares, equal to 32.9% of the
outstanding.
Krohn bought the shares from July 10 to
Aug. 16 at prices ranging from $4.10 to
$4.66 each.
Decreases in Holdings
Babcock & Wilcox Enterprises (BW)
Steel Partners disclosed that it had low-
ered its holding of the energy hardware
maker after it disclosed sales from Aug. 19
to Aug. 23. Steel Partners sold 724,467
shares during that period at prices ranging
from $3.69 to $3.83 apiece and now has a
9.3% interest in Babcock & Wilcox, or
4,280,992 shares.
Papa John’s International (PZZA)
Founder John Schnatter continued to
reduce his holdings through the sale of
725,681 shares from Aug. 20 to Aug. 22 at
prices in a range of $42.50 to $44.22.
Part of the reduction was via a block
sale for which Schnatter agreed to not sell
stock until Sept. 2. After the latest sales,
Schnatter owns 5,395,886 shares, equal to
16.7% of the outstanding.
PulteGroup ( PHM)
Mark Pulte disclosed the sale of
2,358,459 shares from July 22 to Aug. 23.
The transactions were at a price range of
$32.82 to $34.02 per share. The reduction
left Pulte with 14,567,712 shares, equal to
5.3% of the outstanding shares of the
home builder.
InsiderScore.com is a provider of insider,
institutional, and stock-buyback data,
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The 13D Activist Fund, a mutual fund
run by an affiliate of the author and not
connected to Barron’s, has no position in
the securities mentioned here. In addi-
tion, the author publishes and sells 13D
research reports, whose buyers may
include representatives of participants in,
and targets of, shareholder activism.
The Activist Spotlight
The Stars Group (TSG)
Business: gaming and interactive
entertainment
Stock Market Value: $4.3 billion
($14.80/share)
What’s Happening:ValueAct
Capital has acquired a 4.7% position
for investment purposes.
Key Numbers:
61%: percentage of Stars Group
revenue from regulated markets in
2018
79%: percentage of Stars Group
revenue from regulated markets
today
90%: estimated percentage of
Stars Group revenue from regulated
markets in 18 months
Behind the Scenes: ValueAct
hasn’t previously invested in the
gaming industry because of the un-
attractive dynamics of legacy casi-
nos. But Stars Group operates in
the online and mobile gaming and
interactive-entertainment indus-
tries, which aren’t capital intensive,
don’t rely on travel or geography,
and have good cash flow with more
organic growth opportunities.
In July 2018, Stars Group bought
Sky Betting & Gaming, which is
fully integrated into Sky PLC, pro-
viding for a unique entertainment/
gambling experience that attracts a
recreational, sports-fan user base,
and taking market share from other
United Kingdom operators. Stars
Group plans to re-create this type
of media partnership in other mar-
kets.
The company also has a competi-
tive advantage through its Poker-
Stars online poker business, where
critical mass is integral to attracting
new players. This investment would
have been larger for ValueAct, but
going above 5% would require Value-
Act to get licensed in multiple juris-
dictions. The same restriction will
prevent ValueAct from taking a
board seat, but it can get board ob-
server rights.
—KENNETHSQUIRE