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Letters & Theses

Daniel Loeb · Third Point

Third Point's letter to the chief executive of Star Gas Partners

Published 14 Feb 2005Activist letter · Investment

The view as filed on 14 Feb 2005, not a statement of what the author thinks today.

What to notice

  1. 1

    Third Point says management refused its calls for months, and that the 13D was the only channel left to address the chief executive.

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Why read it

Shows the 13D letter used as a public instrument: an activist putting a case against management on the record, in figures and in unusually personal terms.

About this letter

Daniel Loeb of Third Point wrote this letter on 14 February 2005 to Irik Sevin, chairman and chief executive of Star Gas Partners, a heating oil distributor organised as a master limited partnership. Third Point attached it as an exhibit to its Schedule 13D, the filing an investor makes after crossing 5% of a company's shares, so a letter addressed to one man was published to every unitholder at once.

Third Point held about 6% of the common units, which made it the largest unitholder. The letter followed a suspended distribution in October 2004, which it says cut the unit price by 80%, and the sale of the propane business. It reviews the results, the financing and the fees of the preceding months, then turns to governance and pay, and ends by asking the chief executive to step down. Its personal tone made it one of the most cited activist letters filed on EDGAR.

Companies

  • Star Gas Partners SGU

Themes

  • governance
  • management change
  • cost discipline
  • capital allocation
What Third Point owns (13F)

L3VLUP does not host this document. It belongs to Third Point and is a public SEC filing; the notes above are L3VLUP’s reading of it.