Activist fund manager Relational Investors LLC said it won’t seek new target companies while co-founder Ralph Whitworth is on leave for health problems, opting to focus instead on existing investments.
“Although we have decided not to invest in new situations at this time, we will continue to actively manage our portfolio and vigorously pursue the value-enhancing agendas associated with our existing investments,” co-founder David Batchelder said Monday in a statement.
Batchelder and other senior management assumed Whitworth’s duties in mid-July when the firm announced that Whitworth, 58, was taking a leave and resigned as chairman of Hewlett-Packard Co. (NYSE: HPQ), a Relational target he had helped reshape. Whitworth has cancer, people with knowledge of the matter said this month.
Relational currently has investments in industrial companies including equipment manufacturer SPX Corp. (NYSE: SPW), bearings maker Timken Co. (NYSE: TKR), and machinery builder Illinois Tool Works Inc. (NYSE: ITW). This year, Relational has actively sought changes at companies including aircraft seat maker B/E Aerospace Inc. (Nasdaq: BEAV), crane and refrigerator builder Manitowoc Co. (NYSE: MTW), and hazardous waste disposer Clean Harbors Inc. (NYSE: CLH).
After working with billionaire Texas oilman T. Boone Pickens, Whitworth and Batchelder founded Relational in San Diego in 1996 with $200 million from the California Public Employees’ Retirement System, the nation’s largest public pension fund. Today they manage more than $6 billion, buying stakes in public companies they consider undervalued and lobbying executives and directors for changes to boost returns. Relational’s activism often leads to the ouster of chief executive officers and board seats for the fund.
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