Plymouth Lane Capital Goes Activist on Martha Stewart Living Omnimedia ~ market folly

Monday, June 29, 2015

Plymouth Lane Capital Goes Activist on Martha Stewart Living Omnimedia

Jonathan Salinas' hedge fund firm Plymouth Lane Capital has filed a 13D with the SEC regarding Martha Stewart Living Omnimedia (MSO).  Per the filing, Plymouth Lane now owns 10.9% of the company with over 3.55 million shares.

Per the filing, Salinas' firm was acquiring shares throughout May and June at prices between $4.90 and $6.97.

The 13D notes that after the company's recent merger agreement, the hedge fund plans to engage with management of the company.  Martha Stewart is selling itself to Sequential Brands Group (SQBG).

We also previously highlighted some previous portfolio activity from Plymouth Lane Capital here.

About Plymouth Lane Capital

This is the second time the fund's been featured on the site, so here's some background for those who missed it:  Plymouth Lane primarily operates an equity strategy and was launched in April 2013. Prior to founding Plymouth Lane, Jon Salinas worked at Marble Arch Investments and earned his MBA from Columbia Business School.

At a prior Columbia Business School conference, Salinas noted that you have to focus on the margin of safety if it's an event-driven idea. But if it's a compounder-type business, he said you have to have high confidence that earnings will compound at the rate expected. He also mentioned that if you're taking concentrated positions, it's detrimental to let thesis creep go unnoticed. If evidence contrary to your thesis pops up, you have to be able to recognize it and act.

About Martha Stewart Living Omnimedia 

Per Google Finance, the company is "a global lifestyle company. The Company operates in three segments: Publishing, Merchandising and Broadcasting. The Publishing segment primarily consists of the Company's operations related to its magazines and books, as well as its digital operations, which includes the Website, The Merchandising segment primarily consists of the Company's operations related to the design and branding of merchandise and related collateral and packaging materials that are distributed by its retail and manufacturing partners. The Merchandising segment also includes the licensing of talent services for television programming. The Broadcasting segment consists of the Company's limited television operations and its satellite radio operations. Its Website includes Martha Stewart Living, Martha Stewart Collection, Martha Stewart Pets, Martha Stewart Crafts, Martha Stewart Weddings, Everyday Food and Emeril."

blog comments powered by Disqus