NetApp shares jump after Elliott discloses stake

Elliott Management increases stake in NetApp, report says firm is pushing for changes

Associated Press

NetApp Inc.'s shares rose Thursday on a report that hedge fund Elliott Management is pushing for major changes at the data storage company.

THE SPARK: A report by Bloomberg, citing an unidentified person familiar with the situation, said Elliott has proposed new directors for NetApp's board and has asked the company to return cash to shareholders.

Elliott did not immediately respond to a request for comment. NetApp said it does not comment on rumors and speculation.

Elliott disclosed in a regulatory filing Wednesday that it owned 4.1 million shares, or about 1 percent of NetApp's shares outstanding, on March 31. That's up from nearly 4 million shares reported in a February filing. Elliott started building its stake in NetApp last year.

The Bloomberg report also said that Elliott Management may increase its stake in NetApp.

THE BIG PICTURE: Elliott, founded by billionaire Paul Singer, has a history of agitating at companies in which it owns stock. It most recently locked horns with Hess Corp. in a proxy battle to update its board and make changes at the energy company.

Investors may find out more Tuesday when NetApp is scheduled to report its fiscal fourth-quarter financial results. In its most recent quarter, the Sunnyvale, Calif., company reported that its net income increased 32 percent on improved revenue and lower costs.

SHARE ACTION: NetApp shares rose $2.36, or 6.5 percent, to $38.58 in afternoon trading. Shares peaked earlier in the day at a 52-week high of $39.15.

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