Hedge fund Elliot Investment Management built more than $1.5 billion in stake in Hewlett Packard Enterprise, said on Tuesday by someone familiar with the issue.
Elliot, one of the world’s largest activist investors, is currently ranked among the largest investors in information technology companies and plans to engage with management, said someone not allowed to publicly discuss the campaign.
Details that Elliott could potentially be pushing HPE were valued at $20 billion, so it couldn’t be decided immediately.
News from Elliott’s campaign, first reported by Bloomberg, boosted HPE sharing by nearly 5% to $14.98. However, stocks have fallen 30% since the start of the year, roughly four times the 8% decline in the S&P 500 index.
Elliott has a long history of technology investments, owns stakes in Dell Technologies and Salesforce, and the company often joins the board of directors of high-tech companies.
Hewlett Packard Enterprise and Elliott declined to comment.
The company manufactures servers used in data centers that cancel large amounts of data for artificial intelligence tasks, but analysts are considered to be the most at risk from tariffs deployed by US President Trump. Costly production faces margin pressure.
HPE submitted plans in March to cut costs by approximately $350 million by fiscal year 2027.
The company is in the process of acquiring Juniper Networks in all-cash transactions, but has been sued by the U.S. Department of Justice, which is trying to block the transaction, claiming that the transaction will eliminate competition between companies, raise prices and reduce innovation.
HPE CEO Antonio Neri signaled last month that the deal still occurs.
Managing $70 billion in assets, Elliott is driving campaigns in the US and abroad this year despite volatile trading conditions that have urged many other companies and their instigators to find common positions and settle down. It promotes the Philips 66’s four board sheets in one of the industry’s most closely monitored proxy fights. Elliott also owns almost 5% stake in BP and has built a shares in Sumitomo Realty & Development.
One feature of Elliott’s campaign was working with the board to find new management teams in low-performing companies. Since 2022, 14 CEOs have left their jobs at companies where Elliott owns stock, said someone familiar with the issue.
