Starboard Value up more than 10 percent, led by Depomed stake: document

Wed Nov 16, 2016 8:57pm EST
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By Michael Flaherty

NEW YORK (Reuters) - Starboard Value, the activist hedge fund behind shake-ups at Yahoo Inc YHOO.O and Marvell Technology Group Ltd (MRVL.O: Quote), has notched an investment return of more than 10 percent this year on the back of boardroom deals and takeovers.

The Starboard Value and Opportunity Fund has produced a net return for its investors of 10.21 percent through Sept. 30, according to a document seen by Reuters.

The performance is slightly below that of the Russell 2000 index in the same period and above the 6.71 percent posted by peers in the HFRI Event-Driven Index.

Starboard's year-to-date "top winners," according to the document, are network security company Infoblox Inc, which was recently bought by private equity firm Vista Equity Partners, and Depomed Inc (DEPO.O: Quote), a drugmaker whose board the activist investor threatened to overthrow.

Starboard and Depomed struck a truce in October, with the hedge fund getting three seats on the board. At the time of the deal, Depomed's stock was up more than 40 percent from a year before, at $27 per share.

Starboard's net returns to investors was a loss of 8.55 percent in 2015 and a gain of 21.45 percent in 2014, according to the document.

The fund's performance through the third quarter stands out given the struggles of other activist investors this year. The HFRI Activist Index has a return of only 2.33 percent year to date.

Starboard's so-called tear sheet uses the HFR Event-Driven Index as its peer comparison.   Continued...

Jeffrey Smith, Managing Member, CEO and Chief Investment Officer for Starboard Value LP., speaks at the Sohn Investment Conference in New York City, U.S. May 4, 2016.  REUTERS/Brendan McDermid/File Photo