Activist investor targets Hewlett Packard by reportedly building $1.5B stake

New York Post - Apr 15th, 2025

Hedge fund Elliott Investment Management has acquired a stake exceeding $1.5 billion in Hewlett Packard Enterprise (HPE), positioning itself as one of the company’s largest investors. Elliott, known for its activist investment strategies, intends to engage with HPE’s management, although specific demands are not yet clear. This move by Elliott, revealed by Bloomberg, has led to a nearly 5% increase in HPE's share price, even though the stock is down 30% year-to-date. HPE, valued at $20 billion, is currently navigating several challenges, including tariff risks and margin pressures associated with production costs. The company is also embroiled in a legal battle with the U.S. Justice Department over its acquisition of Juniper Networks, which the government argues could harm competition and innovation.

Elliott's involvement with HPE could be significant due to its history of influencing tech companies, often leading to management changes when firms underperform. The hedge fund has been active despite volatile market conditions, pushing for board seats and engaging in high-profile proxy fights, such as at Phillips 66. Elliott’s strategy frequently includes advocating for leadership changes, as evidenced by the departure of 14 CEOs in companies where it has invested since 2022. This development at HPE occurs amid broader challenges in the tech industry, including trade tensions and regulatory scrutiny, highlighting the potential for Elliott to drive strategic changes at the company.

Tariffs Stock Market Tech Industry Mergers And Acquisitions Elliott Investment Management Hewlett Packard Enterprise U.S. Justice Department Activist Investors

Story submitted by Fairstory

RATING

7.6

Fair Story

Consider it well-founded

The article provides a well-rounded and accurate overview of Elliott Investment Management's stake in Hewlett Packard Enterprise and its potential implications. It scores highly in accuracy and timeliness, with most claims supported by credible sources and relevant to current market trends. The story is clear and accessible, though it could benefit from additional perspectives and transparency about sources. While it effectively engages readers interested in business and finance, the lack of direct quotes or diverse viewpoints limits its potential for deeper engagement or controversy. Overall, the article is a reliable and informative piece for those interested in the intersection of activist investing and corporate strategy.

Accuracy

The story is largely accurate, with key claims supported by external sources. For instance, the claim that Elliott Investment Management has built a stake of more than $1.5 billion in Hewlett Packard Enterprise is verified by Bloomberg and Investopedia. Additionally, the story accurately reports HPE's financial struggles, including the 30% decline in shares and cost-cutting measures. However, some details, such as the specific demands Elliott might make of HPE, remain unspecified, reflecting a minor gap in precision. The legal challenge regarding the Juniper Networks acquisition is also correctly reported, further supporting the story's accuracy.

Balance

The story presents a balanced view of Elliott's investment activities and HPE's situation by including both positive and negative aspects. It acknowledges Elliott's history of successful investment campaigns and potential benefits to HPE while highlighting the company's financial struggles and legal challenges. However, the article could have been more balanced by incorporating perspectives from HPE's management or analysts who might provide different views on Elliott's involvement. Overall, the story does a reasonable job of presenting multiple facets of the situation, though it leans slightly towards Elliott's perspective.

Clarity

The article is well-structured and clearly presents the main points, making it easy for readers to follow. It succinctly outlines Elliott's investment, HPE's financial status, and the potential implications of the acquisition and legal challenges. The language is straightforward and neutral, aiding comprehension. However, the inclusion of more context or background on Elliott's typical strategies could enhance clarity for readers unfamiliar with activist investing.

Source quality

The story relies on credible sources, including Bloomberg, a reputable financial news outlet. The use of a person familiar with the matter provides insider insight, though the anonymity of this source slightly impacts reliability. The story would benefit from more direct quotes or statements from HPE or Elliott, which would enhance the credibility and depth of the reporting. Despite these minor limitations, the overall quality of sources is strong, contributing to the story's reliability.

Transparency

The story provides some transparency by citing Bloomberg as the initial reporter of Elliott's campaign. However, it lacks detailed explanation regarding how the information was obtained, especially given the reliance on an anonymous source. The absence of direct comments from HPE or Elliott leaves readers without a clear understanding of all perspectives involved. Greater transparency about the source's background and potential biases could improve the article's transparency score.