US: ValueAct agrees to record fine

The Department of Justice (DOJ) announced this week that ValueAct, activist investment manager, has agreed to pay a record $11 million to settle allegations that it violated the requirements of the Hart-Scott-Rodino Act by improperly relying on the “investment-only” exemption to avoid reporting the transaction and observing the appropriate waiting period.

The settlement stems from ValueAct’s purchases in 2014 and 2015 of stock in two direct competitors, with the intent to participate in those companies’ business decisions, without first complying with the HSR Act’s requirements. As part of the settlement, ValueAct also agreed to injunctive relief designed to prevent future violations.

The complaint details how ValueAct used its access to senior executives of both Halliburton and Baker Hughes to attempt to influence the companies’ proposed merger and other aspects of their businesses. For example, ValueAct executives met frequently with the top executives of the companies and sent numerous e-mails to the executives on a variety of business issues. During these meetings, ValueAct identified specific business areas for improvement and made presentations on post-merger integration.

Full Content: Mondaq

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