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By Svea Herbst-Bayliss
(Reuters) – A former partner at ValueAct Capital Management, one of Wall Street’s best-known activist investment firms, will start his own firm, according to people familiar with the matter, marking one of the highest-profile activist firm launches in recent years.
Dylan Haggart, ValueAct’s head of investments in private equity firm KKR, investment bank Morgan Stanley and media company The New York Times and a member of the board of directors of financial technology company Fiserv (NYSE:) and data storage Seagate Technology has formed a new company called Fivespan Partners, the people said.
Haggart left ValueAct last year after spending 10 years at the San Francisco-based investment firm.
Fivespan, named after a historic bridge in Haggart’s hometown outside Ottawa, Canada, is expected to start making investments in the second half of 2024 and will be based in San Francisco, the sources who were not permitted to say said. speak publicly about the private company’s plans.
It plans to focus on mid-sized companies with growth potential and work with management teams and boards to help them improve operations and capital structures to make them more valuable, the sources said.
Haggart did not respond to a request for comment.
The new launch is among the largest in the activist investor landscape since ValueAct founder Jeffrey Ubben founded Inclusive Capital Partners four years ago and Ed Garden left Trian Investment Management last year to invest his personal fortune through Garden Investments .
Fivespan will begin trading at a time when activists are finding new favor among investors as many have helped push stock prices higher by working with management to make companies perform better. Investors are now rewarding companies that are transforming themselves to be more profitable, allocate capital well and focus on what matters to shareholders.
Last year, the average activist investor returned 18% according to data from Hedge Fund Research, with some companies posting gains of double that while the broader market rallied more than 24%.
After a decade at ValueAct, Haggart embodies the hallmarks of his old company: staying out of the limelight and trying to work collaboratively with management, people who know him said. He rarely speaks at industry conferences and does not give interviews, but is readily available to the target company’s executives for advice and guidance, they added.
The new firm plans to create a portfolio with six to 10 investments at a time, the sources said.
Sarah Coyne, who worked with Haggart as a partner at ValueAct and also left in 2023, will be managing partner at Fivespan, the sources said.
Two more former ValueAct employees, Margarita Krivitski and Andrew Fraga, and Chris Kelly, who previously worked at Voyager Global Management, will join the investment team.
Carly Pollock, an experienced hedge fund industry executive, will be the new company’s chief operating officer, chief financial officer and chief compliance officer, the sources said.