Two New Funds Join Fight Against Sears Holdings

Date: Tuesday, April 18, 2006
Author: HFN Daily Report

Hawkeye Capital Management and Knott Partners are joining Pershing Square in opposing Sear Holdings' attempted takeover of Sears Canada, according to an announcement by Pershing. Sears Holdings, the company created by Eddie Lampert for the merger he engineered between Sears and Kmart, has bid CAN$18 ($15.72) per share for Sears Canada. The company's stock has been trading well above that, and Pershing has called the bid "wholly inadequate." Pershing announced on Monday it has teamed with Hawkeye and Knott to form a group to oppose the merger. The group has pledged to take all appropriate legal action to halt the transaction and will share legal costs. Together, the three hedge funds own 7.7% of the outstanding shares of Sears Canada, which amounts to about 25.7% of the shares not owned by Sears Holdings. Knott Partners is based in Syosset, N.Y., while Pershing and Hawkeye are based in New York City.