Mednax Faces Activist Pressure from Hedge Fund Starboard Value

December 11, 2019 | Hedge Funds, Investments, News

Wall Street Journal reports pressure for full or partial sale.

Mednax, a healthcare service provider, is facing activist demands from Starboard Value. The hedge fund is reportedly seeking a complete or partial sale of the company. The Journal says that Starboard has nominated a full slate of nominees for the company’s board of directors. The nominations came last week just before the deadline.

Mednax and Starboard Value

The report continues that the healthcare firm is in conversations with the firm. Mednax is trying to get Starboard to withdrawal its roster of nominees. A proxy battle could come in the months ahead of talks sour.

The pressure comes at a tough time for the healthcare firm, which has seen its shares decline by roughly 25% this year. Shares have fallen for four years due to increasing expenses. The firm also experienced a very large goodwill impairment charge during the last quarter.

Meanwhile, Starboard Value remains active in the market. This year, the firm took a stake in CVS Health and met with company leaders.

Starboard Value also purchased a 7.5% stake in the cloud storage company Box Inc. Jeffrey Smith’s firm is now the second-largest shareholder after the Vanguard Group. Finally, Smith, who is also the head of Starboard and chairman of Papa John’s – hired Rob Lynch, a standout executive at Arby’s, as the new CEO of the pizza company.

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