ValueAct Fined Over Share Purchases

San Francisco-based private equity firm ValueAct Capital Partners LP has been ordered to pay $1.1m in fines to the FTC, which says it failed to properly notify regulators when it acquired large stakes in research and information firms Gartner Inc., Catalina Marketing Group and Acxiom Corp. in 2005.

On Feb 7th 2005, a ValueAct fund raised its share of Gartner to $248m - and the same fund bought more than 10% of Catalina and Acxiom Corp on April 28th. All three moves required immediate notification to the FTC and Justice Department under a federal law covering purchases of more than $50m of stock or when crossing the $100m threshold - the law then requires buyers to wait 30 days before closing the transaction. However, the FTC says ValueAct only notified it on June 13 that year.

The statement from Jeffrey Schmidt, Director of the FTC's Bureau of Competition, which describes itself as 'flexible' and willing to 'forgive an inadvertent error', says ValueAct had promised to do better after committing three antitrust filing violations in 2003, including one relating to an earlier purchase of Gartner shares. Previous transgressors against the law include Microsoft Chairman Bill Gates whom the FTC fined $800,000 for failure to report a share purchase made in May 2004.

Catalina was acquired in April this year by private equity investment firm Hellman & Friedman, defeating an earlier bid from ValueAct (www.mrweb.com/drno/news6685.htm ). Web sites are at www.catalinamarketing.com , www.valueact.com and www.ftc.gov.

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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