Thursday, 23 October 2014
Last updated 13 hours ago
Oct 29 2007 | 11:56am ET
The battle over Europe’s third largest insurer is taking shape this week, as activist hedge fund Algebris Investments begins to meet with other Assicurazioni Generali shareholders while Generali’s board meets on Wednesday.
London-based Algebris, which owns 0.3% of Generali but said it could raise its stake to 1%, today began meeting with investor groups interested in its proposals to improve governance and shareholder returns at the Trieste-based insurance giant, Italy’s largest. There are reportedly more than 20 such groups that have contacted Algebris, though it is unclear how many shares in the insurer they represent.
Last week, Algebris sent a letter to Generali’s board complaining about the firm’s poor performance, charging that it underperforms its larger rivals Allianz and Axa. According to Algebris, Generali achieves only 60% of its potential earnings. The hedge fund demanded “more robust corporate governance” and that the company split the CEO’s job and the chairmanship.
Algebris’ prospects are still somewhat uncertain. It needs the support of shareholders representing just 2.5% of Generali to forward motions at April’s annual meeting, and 10% to call an extraordinary meeting. Trading volume in Generali shares soared fourfold in the last three trading days, during which upwards of 8% of the company’s shares may have changed hands.
But Mediobanca, the investment bank that is Generali’s largest shareholder with a 16% stake, threw its support behind Generali management. It did say, however, that it would hear discussion on new corporate governance initiatives at the insurer.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...