March9,2020 BARRON’S M7
INSIDE SCOOP
Stephen Luczo is
the only Morgan
Stanley insider
who has been
buying stock
this year.
from $122.10 to $140 apiece, citing
no specifics for the fresh invest-
ment. In December 2019, Interna-
tional Flavors & Fragrances agreed
to merge withDuPont’s (DD)
Nutrition and Biosciences unit, a
segment valued at approximately
$26.2 billion.
Trinity Industries
(TRN)
ValueAct Capitallifted its interest
in the transportation and construc-
tion firm to 22.4%. ValueAct bought
a total of 1,219,113 shares from Jan.
29 to March 3 at prices ranging
from $20.41 to $21 each. The fresh
investment followed the previously
disclosed purchase of 723,509
shares in January, and now gives
ValueAct a total stake of 26,832,620
shares.
Decreases in
Holdings
Alector(ALEC)
OrbiMed Advisorsrevealed a
smaller investment in the clinical-
stage biopharmaceutical company
of 8,716,344 shares. Without citing
a reason, OrbiMed disclosed it sold
1,891,000 Alector shares, nearly
18% of its holdings, on March 2
through a block trade executed at
$26 apiece. It now owns 11.1% of
Alector’s outstanding stock.
Instructure(INST)
Praesidium Investment Manage-
mentrevealed a reduced interest of
5.7% in the cloud-based education
and professional-development ser-
vices firm. Praesidium sold 686,263
Instructure shares from Feb. 24
through Feb. 26 at an average per
share price of $48.76, leaving
Praesidium with 2,179,261 shares.
Thoma Bravohad approached
Instructure in December with an
offer to acquire the firm for $47.60
per share in cash. Instructure’s
board rejected that offer, but ap-
proved Thoma Bravo’s revised pro-
posal, a “best and final offer” that
was disclosed Feb. 14, that bumped
up the offer to $49 a share. The
revised tender offer for Instructure
shares expires at the end of March
20, unless extended or terminated.
Increases in
Holdings
Dave & Buster’s
Entertainment(PLAY)
Kohlberg Kravis Roberts(ticker:
KKR) increased its stake in the
casual-dining and entertainment
chain to 2,525,800 shares. KKR
added 587,324 shares from Feb. 26
to March 3 at per share prices
ranging from $29.93 to $37.34. KKR
noted that it had entered into a
derivative agreement with a third
party in the form of cash-settled
forward contracts, which adds ex-
posure to 1,345,493 additional Dave &
Buster’s shares. Including those con-
tracts and the open-market stock pur-
chases, KKR holds an overall interest
in Dave & Buster’s of 12.7%.
International Flavors &
Fragrances(IFF)
Winder Investmentincreased its
stake in the ingredient and additives
company to 22,665,059 shares, inclu-
sive of 927,193 tied to purchase con-
tracts. It now holds 21% of the trad-
able stock. Winder’s investment
includes 927,193 common shares
covered by purchase contracts. From
Dec. 27 to Feb. 25, Winder bought
1,343,809 shares at prices ranging
These disclosures are
from 13Ds filed with
the Securities and
Exchange Commission.
13Ds are filed within
10 days of an entity’s
attaining more than
5% in any class of a
company’s securities.
Subsequent changes
in holdings or inten-
tions must be re-
ported in amended
filings. This material is
from Feb. 27 through
March 4, 2020
Source:Insider-
Score.com
POWER PLAY
P
art of the gang that success-
fully pushed for changes at
BedBath&Beyondhas
found a new target.
Big Lots(BIG) is in the
crosshairs ofMacellum Advisors
andAncora Advisors, two of the
three hedge funds that went after
Bed Bath & Beyond (ticker: BBBY)
last year. The duo holds 11% of the
retailer’s stock and wants to re-
place the nine-member board. The
activists met with current Big Lots
directors, who acknowledged is-
sues facing the company but ex-
pressed reluctance to change the
current makeup of the board, ac-
cording to persons familiar with
the matter.
In an open letter, the activists
noted that Big Lots recently re-
ceived a “credible offer” from a
private-equity firm to buy the re-
tailer’s real estate in a $1 billion
sale-leaseback transaction. For
perspective, Big Lots’ market cap
was just below $700 million be-
fore the hedgies’ stake was re-
vealed, implying that outside of
the real estate, the company has
negative value. It also has roughly
$1.5 billion of debt.
Big Lots also made several “ill-
timed” capital-allocation decisions,
according to the activists, including
buying back more than $1 billion of
stock in recent years while shares
were falling, recently hitting an
intraday decade-low.
The activists may already have
Big Lots investors on their side.
The company rankled Wall Street
analysts by cancelling a March 9
investor day, and the stock rallied
on Friday after the activists’ letter
went public.
Big Lots acknowledged the let-
ter, and said it would have “further
such discussions” with the funds.B
Morgan Stanley’s Newest
Director Bought Up Stock
M
organ Stanley’s newest
director continues to
buy up shares of the
financial-services giant
on the open market.
Stephen Luczo, who
joined Morgan Stanley’s
(ticker: MS) board in October, first
bought shares after the company
announced that it agreed to buy
discount brokerE*Trade Financial
(ETFC). The Feb. 20 announcement
sent Morgan Stanley stock sliding
nearly 5%.
Morgan Stanley continued its fall
the next day, a Friday, when Luczo
paid $2.6 million for 50,000 shares,
an average price of $53 each,
according to a form he filed with the
Securities and Exchange Commission.
Since then, fears of the coronavirus
outbreak have sent the market—and
Morgan Stanley stock—sliding.
On Friday, Feb. 28, a week after his
earlier purchase, Luczo paid only $2.2
million for 50,000 shares, an average
per share price of $44.97. He made his
purchases through a trust that now
owns 171,000 Morgan Stanley shares,
and he holds an additional 3,122
shares in a personal account.
Luczo is chairman ofSeagate
Technology(STX), a maker of hard
drives.
Morgan Stanley declined to com-
ment and didn’t make Luczo available
for comment on his stock purchases.
Seagate didn’t respond to a request to
make Luczo available for comment.
Luczo is the only Morgan Stanley
insider who has been buying stock this
year. In 2019, the shares matched the
28.9% rise in the S&P 500 index. But
so far in 2020, the 18.2% drop in
Morgan Stanley’s stock is about twice
that of the index.B
By ED LIN
Big Lots
Targeted
for Changes