Major investors are sourcing on eBay, and activists are showing flexibility

NEW YORK (Reuters) – EBay Inc. stock prices plummeted for most of last year, but a number of leading hedge funds were so convinced that changes were looming over the past year. the horizon for the e-commerce company that they have created new positions or added existing positions in the last months of 2018.

Baupost Group, led by Seth Klarman, and BlueMountain Capital both made new investments, while Hudson Bay Capital Management and Adage Capital Partners expanded their bets with major fourth quarter purchases, regulatory filings and Symmetric-compiled data. .io.

The banking giants UBS AG, Citigroup Inc., JPMorgan Chase and Morgan Stanley, which invest for individual and institutional clients, also bought millions of new shares, according to the data.

For these investors, the nearly 30% rise in eBay's share price over the first seven weeks of trading represents a significant boon, which was probably fueled by behind-the-scenes moves from two activist hedge funds that have also built holdings recently.

Elliott Management, one of Wall Street's most active and successful activists, said in its reference document that it made a new bet on eBay in the fourth quarter, listing call options over $ 8.5 million. shares. In January, Jesse Cohn, a partner at Elliott and head of its US Equity Activism, wrote to eBay's board of directors asking him to sell the StubHub box office and its clbadifieds business, saying it could help push the course of action to such a high level. $ 63 per share in 2020. He closed at $ 36.32 on Thursday.

Starboard Value, another leading hedge fund that has won more board seats than others, has also established a stake and contacted management, people were familiar with, although eBay did not appear. in the Starboard rankings.

Starboard did not answer questions about the job.

The 13-F regulatory filings requiring fund managers to detail the amount of shares they held in US companies at the end of the previous quarter often do not require depositors to disclose derivatives, which means that an investor can build a position without revealing himself. this deposit.

Ebay announced on Thursday a restructuring plan that will unite geographic regions into a global segment and announced the departure of an executive, Scott Cutler.

Baupost's 13-F report says it bought 21 million shares of eBay in the fourth quarter, making it one of eBay's top five US holdings.

To be sure, there were also hedge funds that fell back. Glenview Capital Management of Larry Robbins, which rose 17% in January after a 16% loss in January, sold 4.4 million eBay shares, reducing its position by 37%.