Hedge fund may try to hamper Berkshire Hathaway's bid for Oncor
Billionaire Paul Singer’s Elliott Management Corp. is promising a lengthy takeover battle if Warren Buffett doesn’t improve the terms of his offer for Oncor Electric Delivery Co.
The hedge fund said a bid by Buffett’s Berkshire Hathaway Inc. for Oncor Electric fails to maximize value for creditors, according to a July 5 letter released Monday. Elliott, the largest creditor to Oncor’s bankrupt parent, Energy Future Holdings Corp., is pushing the Texas utility to allow for alternate proposals with better valuations.
Elliott is the same activist investor that purchased an 11 percent stake in Sidney, Nebraska-based Cabela’s and began pushing for changes, ultimately resulting in the proposed sale of Cabela’s to rival Bass Pro Shops.
Elliott published some documents together with the letter, which was sent to Energy Future just days before Berkshire Hathaway announced its Oncor deal. The hedge fund also urged the utility’s board to immediately bring Elliott into its negotiations regarding any alternatives, including talks on the deal with Berkshire to avoid “unnecessary litigation costs and expenses” and to help with confirmation of a plan of reorganization “upon which an alternative transaction rests.”
Read more: http://www.omaha.com/money/buffett/hedge-fund-may-try-to-hamper-berkshire-hathaway-s-bid/article_d2f87d54-4aab-5b9d-a7f7-d43c2c302afa.html
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