Starboard investment in Bristol-Myers in 2019

Starboard Value invested in Bristol-Myers in 2019 and made public a presentation for it. If you are interested to learn about how hedge funds write presentations, here is one for you to learn from.

About the Starboard Value deck

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About the deal

In 2019, Starboard Value, an activist investment firm known for its involvement in corporate governance and operational improvements in its portfolio companies, took an interest in Bristol-Myers Squibb, a prominent pharmaceutical company. This move came at a critical time when Bristol-Myers was in the process of acquiring Celgene, another major player in the biopharmaceutical industry, in a deal valued at approximately $74 billion. Starboard acquired a stake in Bristol-Myers Squibb and expressed concerns about the proposed acquisition of Celgene, suggesting that the deal posed significant risks and might not deliver the promised value to shareholders.

Starboard’s involvement attracted significant attention from the investment community and the media, as activist investors like Starboard can influence the strategic decisions of large corporations, including pushing for changes in management, operations, or strategic direction. Their primary contention was related to the valuation, the strategic fit, and the potential integration challenges of combining two large pharmaceutical companies with different cultures and product pipelines.

However, despite Starboard’s efforts to rally opposition against the deal, Bristol-Myers Squibb’s shareholders eventually approved the acquisition of Celgene. This approval marked a notable defeat for Starboard in this instance but underscored the influential role activist investors play in shaping corporate strategies and governance. The acquisition of Celgene by Bristol-Myers Squibb was seen as a transformative move for the company, significantly expanding its portfolio of treatments in oncology, immunology, and inflammation.

About Starboard Value

Starboard Value stands out as a prominent activist hedge fund founded in 2002 by Jeffrey C. Smith, Mark R. Mitchell, and Peter A. Feld. Renowned for its bold investment strategies, the company targets underperforming or undervalued public companies, leveraging its significant stake to advocate for changes aimed at enhancing shareholder value. Through meticulous research and detailed analysis, Starboard identifies areas for operational improvements and shifts in corporate governance, catalyzing campaigns that often result in significant transformations within target companies.

With a history of high-profile engagements spanning diverse industries such as technology, retail, hospitality, and healthcare, Starboard Value has earned a reputation as a leading force in activist investing. Notable campaigns with companies like Darden Restaurants, Yahoo (now part of Verizon), and Perrigo Company demonstrate the firm’s knack for driving meaningful changes in corporate strategy, governance practices, and operational efficiency. By installing its own nominees on target company boards and influencing key decisions, Starboard has consistently demonstrated its ability to unlock value and deliver returns for its investors through its proactive and assertive approach.

About Bristol-Myers

Bristol-Myers Squibb Company, commonly known as Bristol-Myers, is a global biopharmaceutical company headquartered in New York City, United States. Founded in 1858 by Edward Robinson Squibb, the company has a long history of innovation and discovery in the healthcare industry. Bristol-Myers focuses on the research, development, and commercialization of innovative medicines and therapies for the treatment of various diseases, including cancer, cardiovascular diseases, immunological disorders, and infectious diseases. The company’s product portfolio includes a wide range of pharmaceuticals and biologics, including blockbuster drugs such as Opdivo (nivolumab), Eliquis (apixaban), and Orencia (abatacept). Bristol-Myers is also actively engaged in research and development collaborations with academic institutions, biotechnology companies, and other partners to advance the development of new treatments and therapies. With a commitment to improving patient outcomes and addressing unmet medical needs, Bristol-Myers continues to be a leading player in the biopharmaceutical industry, making significant contributions to healthcare and medical innovation worldwide.

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