Irvine-based Gateway Inc. has attracted a shareholder it might not want.
Harbinger Capital Partners Master Fund I Ltd., a hedge fund affiliated with Birmingham, Ala.-based Harbert Management Corp., has scooped up a 6.6% stake in the struggling computer maker, according to a filing with the Securities and Exchange Commission in late July.
The fund comes with a reputation as an activist shareholder.
Harbinger and its managers have garnered headlines for stirring up controversy in both high- and low-profile companies, sometimes in bankruptcy court.
The fund focuses on “distressed and special situation” stocks, according to its Web site. Gateway likely fit the bill after shares recently hit an all-time low.
Gateway’s cash hoard of some $425 million in cash makes a bankruptcy a non-factor.
Harbinger has become the third-largest holder of stock in Gateway, behind founder Ted Waitt and Brandes Investment Partners LP.
What the Harbinger stake means for Gateway isn’t clear. The move could be seen as a vote of confidence in the company. Or it could bring pressure for management to take more radical moves to turn around the company.
Gateway has struggled to turn a profit in the face of growing foreign competition and the two biggest players in the industry: Hewlett-Packard Co. and Dell Inc.
The company doesn’t have a permanent chief executive. Chairman Rick Snyder stepped in as interim chief earlier this year when Gateway’s former top executive, Wayne Inouye, left.
For more on this story, see the Aug. 7 edition of the Business Journal.
