Einhorn Takes Apple Proxy Battle to Shareholders
Hedge fund manager David Einhorn, who is battling Apple in court as part of a wider effort to get the iPhone-maker to share more of its cash pile, will now make a direct appeal to the company's shareholders.
He will host a conference call on Thursday to argue the merits of distributing perpetual preferred stock -- his favored way of rewarding shareholders.
Einhorn's $8 billion Greenlight Capital is seeking an injunction to block a Feb. 27 shareholders' vote on "Proposal 2" in Apple's proxy statement, which would abolish a system for issuing preferred stock at its discretion.
Apple declined to comment on Einhorn's plan to appeal directly to shareholders. Chief Executive Tim Cook last week dismissed the lawsuit as a"silly sideshow".
But Cook said the idea of issuing preferred stock was creative and one that Apple's board was carefully considering, while it ponders other ways to share its $137 billion in cash and securities -- something Wall Street investors have been seeking for years.
But even as the hedge fund star tries to rally Apple shareholders to his cause, the Nathan Cummings Foundation, which says it has been a limited partner of Greenlight's through its endowment, said it was "dismayed" that Einhorn was suing Apple to prevent a vote on Proposal 2.
"We very much oppose your decision to enjoin the 2013 annual meeting and the vote on Resolution #2," Simon Greer, president and CEO of the foundation,said in a letter to Einhorn that was obtained by Reuters.
In response, Greenlight said in a statement: "This is a former investor who redeemed. We wish them well."
Greer however said later in an emailed statement that the foundation remained an investor with Greenlight through a "pooled fund", without elaborating.