Alternative Investments: Activists Will Get Busy Soon, Says Tim Melvin

By: Tim Melvin

As companies become more undervalued as the economy slows because of shutdown orders across the United States, I expect that the pace of activist activity to increase. We should see more filings later this week as investors hit the deadline to file on shares purchased during the selloff that started yesterday.

Tim Melvin on Activist Investors

Trigran Investments changed its holding in Coffee Brothers (FARM) from passive status to active this week.

The investment advisory firm said in the filing that it would be mutually beneficial to have more in-depth conversations with respect to certain business matters of the Issuer. Farmer Brothers was the center of a family fight for control last year and while the current board held the reins at the annual meeting the business has been struggling and I think we will see activist pressure throughout 2020. The board will be urged to fix it or sell it with an emphasis on selling it.

Trigran owns 13% of the company according to the filing.

Joseph Stilwell filed a 13D announcing that he had sold a significant percentage of his holdings in Business Development Company (BDC), Garrison Capital (GARS). Mr. Stilwell filed the original 13D back in January showing the owned 5% of the company. He wrote in the filing that he thought Garrison should be sold to maximize shareholder value. With Garrison selling over sharply in recent weeks, Mr. Stilwell has reduced his holdings to just 1.3% of the BDC.

 

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