Outerwall (OUTR) , Heartware International (HTWR) , Magnachip Semiconductor (MX) , Jamba Juice (JMBA) and Benchmark Electronics (BHE) are all at various stages of being targeted by activist investor Glenn Welling of Engaged Capital.
And even though Welling, based in Newport Beach, Calif., only launched his fund in 2012, his pedigree carries some weight with long-term institutional investors. He worked with governance godfather Ralph Whitworth at Relational Investors before forming his own fund and his director election contests -- seven over the past two-plus years -- have mostly resulted in settlements involving dissident board members or, in some cases, a sale of the targeted company.
Case in point is one of his latest targest: Outerwall. On Tuesday the company announced it had reached a deal with Welling that will put three dissident director candidates onto its board over the coming months in a settlement that will put pressure on the parent company of Redbox DVD kiosks and Coinstar change machines to sell itself or institute a large annual dividend.
Outerwall last month launched a process retaining Morgan Stanley to explore alternatives. But, in an unusual twist, Welling will have a direct line to the review process: The first of his directors to be installed, Jeffrey Brown, CEO of Brown Equity Partners, will be permitted to participate in any conference call or meeting between the company's chairman, Nelson Chan, and its financial advisers regarding the review and auction process.
According to people familiar with the situation, Engaged threatened a contest and continued its push to install directors to ensure that Outerwall runs a process that has a sense of urgency. He added that Engaged believes that a fair auction process should take about three months and conclude in June.
Here's a quick rundown of Welling's plans for additional targets.