Bell Rock dumps most of its Whitehaven shares
Make us a preferred source
Make us a preferred source on Google
The news: Activist investor Bell Rock has sold most of its physical Whitehaven shares, after waging an intense campaign against management at the coal miner.
A disclosure statement to the ASX revealed the hedge fund has sold 35 million Whitehaven shares, the majority of its direct shareholding in the company.
The numbers: Bell Rock sold the shares at an average strike price of $7.72, seeing it pocket around $270 million. The fund did not disclose what it paid for them.
Bell Rock still holds approximately 5 million ordinary shares, representing a 0.60% stake in the company. It also revealed an additional derivative stake in Whitehaven equal to about 4.7% of the company. It follows an application Whitehaven made to the Takeovers Panel, complaining that Bell Rock hadn't previously disclosed this derivative position publicly.
Whitehaven's share price had fallen 3.63% at 1pm AEDT on Monday.
The context: Its remaining derivatives position, held in 'swaps', suggests Bell Rock stood to gain more from dividends and buybacks than potential longer term capital growth – possibly explaining its media campaign.
The sale may also indicate Bell Rock is walking away after failing to derail Whitehaven's acquisition of Daunia and Blackwater, two BHP coal mines. The deal had been the target of a sustained campaign by Bell Rock. Yet despite the hedge fund's vocal opposition, Whitehaven emerged as the successful bidder on October 16.
Unable to stop the acquisition, Bell Rock turned its attention to Whitehaven management. At its AGM on Thursday, shareholders delivered a first strike against the company's rem report but otherwise appeared supportive of the company's broader strategy, voting broadly in line with management.
The Takeovers Panel process is ongoing but Bell Rock has previously stated it would remain a 'long term investor' in Whitehaven.
Whitehaven and Bell Rock were both contacted for comment.
The source: Whitehaven ASX Release
