Sculptor Capital Management’s proposed sale to Rithm Capital for $639m has been criticised by Daniel Och, the hedge fund’s founder and one of its largest shareholders, because it “undervalues” the business, according to a report by The Financial Times.
The report cites a letter sent on Wednesday to Sculptor’s board of directors by Ochs, who owns a 12.5% stake in the firm, as confirming his opposition.
“We believe that the transaction with Rithm substantially undervalues the company and penalises all shareholders for the board of director’s breaches of fiduciary duty and the lack of proper oversight that has repeatedly destroyed shareholder value,” Och wrote in a letter also signed by other former executives. “Absent material changes to the proposed transaction, we will vigorously oppose this transaction.”
Och settled a legal battle last year with Sculptor’s management over the decision to pay Chief Executive Jimmy Levin more than $145m in 2021, despite what Och described as “a period of less than mediocre performance”, with a special board committee agreeing unanimously to sell the firm.
