Lowe's Cos. Inc. (LOW) shares spiked up 5% Friday afternoon on a report that newbie activist investor D.E. Shaw & Co., a private equity fund, is planning to agitate for change at the retail home improvement giant.
According to Bloomberg, citing sources, the investor has built up an activist stake in Lowe's and plans to agitate for change. The campaign will put new pressure on Lowe's CEO Robert Niblock.
D.E. Shaw recently hired former Elliott Management portfolio manager Quentin Koffey to lead its activist investing team.
It recently reported a 5.1% passive stake in Babcock & Wilcox (BW), which recently reached a settlement to install three dissident directors with another activist buyout shop, Vintage Capital.
Koffey led D.E. Shaw's recent efforts to press EQT Corp. (EQT) to separate its upstream and midstream businesses. The fund's campaign at EQT came after established activist fund Jana Partners sought unsuccessfully to break up EQT's $6.7 billion acquisition of rival natural gas producer Rice Energy Inc. Jana Partners is also pressing for EQT to break up its upstream and midstream businesses.
Lowe's, which has an $82 billion market capitalization, would by far be the most significant activist campaign D.E. Shaw has ever undertaken.
Lowe's shares were trading late Friday at $100.82, up 5.27% on the news. In November, Lowe's posted same-store sales growth of 5.7% and earnings of $1.05 per share, both exceeding Wall Street forecasts.
A spokesman for D.E. Shaw declined to comment.
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