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AstraZeneca: is Elliott Associates preparing to enter the fray?

By: David Goehring

The Pfizer/AstraZeneca story might be just about to get even more interesting if this suggestion that Elliott Associates has been building a stake is accurate.

Elliott Associates, for those who don’t know, is run by activist investor Paul Singer, and Mr. Singer is not a man to be pushed around. Elliott has made a substantial share of its profits by buying distressed debt and then playing hardball with the debtor to extract payment. Whether the debtor is a company or a country does not matter and, in one famous case, Elliott went so far as to detain the flagship of Argentina’s navy to extract payment! Other efforts included attempting to seize the presidential plane and menacing the Argentine booth at the Frankfurt Book Fair. You can read the story of this at Forbes.

Singer has been a powerful Republican power broker for some years and, in 2004, he helped raise funds for the Swift Boat Veterans for Truth, the group that raised the issue of John Kerry’s war record in Vietnam.  He has also been a contributor to George W. Bush’s and Rudy Giuliani’s campaigns. Whether you agree with his politics or not, his worries about government debt and the entitlements culture that politicians’ promises have created are worth reading: ZeroHedge makes available extracts from one of his letters to investors here.

Singer is, however, more than just the classic hard-nosed free marketeer. He has also been a long-standing champion for gay marriage and has made substantial donations to groups that back pro-gay Republicans. His view is that same-sex marriage promotes “family stability” at a time when the “institution of marriage in America has utterly collapsed.”

So, for any AstraZeneca shareholders out there feeling that their somewhat lofty Chairman Leif Johansson has acted against their interests in seemingly rushing to close the door on the chance of a higher offer from Pfizer, then they should take succour from the fact that, if Paul Singer has indeed been building a stake, they could not have a more powerful ally about to come to their side.

References: Wikipedia

Disclosure: Long AZN.
Disclaimer: This post is not a recommendation to either buy or sell. Please consult your investment advisor.

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