Friday, 26 August 2016
Last updated 1 hour ago
Feb 14 2008 | 1:00am ET
When activist hedge funds turn on the vitriol, their targets rarely respond with pragmatism. But discount clothing retailer Syms Corp.—“where an educated consumer is our best customer”—is backing down against an activist onslaught, with a sigh of resignation.
Faced by hedge fund fury resulting from its decision last year to delist its shares from the New York Stock Exchange, Syms has decided to list its shares once again, this time on the Nasdaq Stock Market.
“We chose to deregister to save money,” Syms CEO Marcy Syms said in a statement. “We are registering for the same reason. We have no intention of wasting further time and money on litigation.”
Syms said its decision to sell its shares over-the-counter would save the company $750,000 in compliance costs. But shareholders, led by hedge fund Barrington Capital Group, went altogether ballistic, arguing that the move would destroy shareholder value.
The Barrington group, which owns a 9.8% stake in Syms, sought to build support amongst shareholders to prevent the delisting, and the hedge fund sued the company for breach of fiduciary duty.