Activist hedge fund firm Elliott Investment Management has clarified it has not made demands or initiated contact with German utility giant RWE AG regarding any potential investment, according to a report by Reuters.
The fund issued a statement after a Bloomberg News report, citing unnamed sources, claimed that Elliott had acquired a significant stake in RWE and was urging the company to launch a share buyback program.
In response, Elliott issued a statement categorically denying the report: “Bloomberg’s report is false. Elliott has not engaged with anyone at RWE regarding an investment in the company, nor has it expressed any views on buybacks or other demands.”
When asked if it has already built or is in the process of building a position in RWE, Elliott declined to comment. RWE also declined to issue a statement on the matter. Despite the denial, RWE’s Frankfurt-listed shares saw a brief 0.6% uptick following the Bloomberg report, reflecting investor anticipation.
Discussions around buybacks have been a recurring point of interest for RWE investors. In March, during a call on full-year results, RWE’s management faced pressure from investors seeking clarification on potential buyback plans. Then, in May, CFO Michael Mueller hinted at the possibility of returning cash to shareholders through buybacks.
Elliott, one of the world’s largest activist hedge funds with around $70bn in assets, has a history of pursuing iconic companies to maximise their performance. Recently, Elliott pushed US coffee chain Starbucks toward reforms and reached a truce with Southwest Airlines, leading to new board appointments aimed at boosting returns.
Elliott often builds stakes using derivatives before converting them to common stock, a tactic that allows the fund to quietly accumulate a significant position before engaging with company management.
