23feb-Business Week--A Bigger Voice For Small Investors
The very rich, F. Scott Fitzgerald once observed, "are different from you and me." That has applied even to shareholder activism, a niche of the investing world dominated by hedge fund managers who are paid enormous fees to holler and claw for every last nickel of return on behalf of their wealthy clients.
But with corporations under mounting pressure to acknowledge shareholder rights, ordinary mutual fund managers are increasingly asserting themselves on behalf of smaller investors.
The standout example is David J. Winters, chief executive of Mountain Lakes (N.J.)-based Wintergreen Advisers, a mutual fund firm with $1.3 billion in assets under management. His 15-month-old Wintergreen Fund(WGRNX ) returned 20% in 2006, four points more than the Standard & Poor's 500-stock index, thanks in good part to his activist approach. "We don't treat our stocks like rental cars," says Winters. "You've got to think and act like an owner, getting the company to think better."
That's what Winters has been doing with his second-largest position, Consolidated-Tomoka Land Co(CTO ). The 105-year-old property developer owns a vast expanse of virgin land in Florida. Winters has been using his 16% stake to encourage management to stay the course on its measured development campaign and to buffer it from pressure to liquidate its acreage. "We try to engage companies in a long-term constructive way," says Winters. "They've been very receptive."
Meanwhile, Franklin Mutual Advisers, Winters' old fund shop, has affixed itself to the ankle of forest products giant Weyerhaeuser Co (WY ). Franklin is using its $1.2billion stake to petition the company to convert itself into a real estate investment trust in order to gain tax advantages.
for info:
http://yahoo.businessweek.com/magazine/content/07_04/b4018050.htm
The very rich, F. Scott Fitzgerald once observed, "are different from you and me." That has applied even to shareholder activism, a niche of the investing world dominated by hedge fund managers who are paid enormous fees to holler and claw for every last nickel of return on behalf of their wealthy clients.
But with corporations under mounting pressure to acknowledge shareholder rights, ordinary mutual fund managers are increasingly asserting themselves on behalf of smaller investors.
The standout example is David J. Winters, chief executive of Mountain Lakes (N.J.)-based Wintergreen Advisers, a mutual fund firm with $1.3 billion in assets under management. His 15-month-old Wintergreen Fund(WGRNX ) returned 20% in 2006, four points more than the Standard & Poor's 500-stock index, thanks in good part to his activist approach. "We don't treat our stocks like rental cars," says Winters. "You've got to think and act like an owner, getting the company to think better."
That's what Winters has been doing with his second-largest position, Consolidated-Tomoka Land Co(CTO ). The 105-year-old property developer owns a vast expanse of virgin land in Florida. Winters has been using his 16% stake to encourage management to stay the course on its measured development campaign and to buffer it from pressure to liquidate its acreage. "We try to engage companies in a long-term constructive way," says Winters. "They've been very receptive."
Meanwhile, Franklin Mutual Advisers, Winters' old fund shop, has affixed itself to the ankle of forest products giant Weyerhaeuser Co (WY ). Franklin is using its $1.2billion stake to petition the company to convert itself into a real estate investment trust in order to gain tax advantages.
for info:
http://yahoo.businessweek.com/magazine/content/07_04/b4018050.htm
