Algonquin Power & Utilities Corp. (AQN)

[Enterprising Investor]

Starboard takes stake of about 5% in Algonquin Power, Wall Street Journal reports (6/29/23)

Starboard Value has gained a more than 5% stake in Algonquin Power & Utilities (AQN.TO), the Wall Street Journal reported on Thursday, citing people familiar with the matter.

The activist hedge fund has privately held talks with Algonquin about its belief that the company's core regulated-utilities business is undervalued, the newspaper reported.

Starboard thinks investors are not giving the company credit for how much value it could fetch from a sale of its renewable-energy operation, the WSJ report said.


data raised expectations

Algonquin had announced in May that it had initiated a strategic review of its renewable energy group, following a push by Corvex Management, which built a stake in the company in April, and other activist firms for changes.

Starboard is pushing Algonquin to follow through with the strategic review, the WSJ reported.

Algonquin owns and operates regulated utilities, as well as power generating and water assets, across Canada and the United States, with its regulated business serving more than 1 million customers, according to its website.

The company is grappling with a $7.5 billion debt burden following a series of acquisitions in recent years.

Algonquin Power declined to comment when contacted by Reuters and Starboard Value did not immediately respond to a request for comment.

https://www.reuters.com/markets/deals/starboard-takes-stake-about-5-algonquin-power-wsj-2023-06-30/