All, right, so I’m going back on my promise to steer away from this self-absorbed topic for awhile. But it’s not my fault; other people keep writing things that demand attention.
Such as this piece in today’s Wall Street Journal. What grabbed me was the promo to this from the front page. It said:
As activist investors pressure executives to get shares higher, is it creating a short-term pop in some shares at the risk of the companies’ long-term health?
To which I can only say, Do ya think? Could it be true?
Along the same lines, I refer you to the sidebar to that "Heard on the Street" piece, which begins as follows:
As Florida money manager Bruce S. Sherman presses his campaign for a sale of Knight Ridder Inc., he and other principals of his firm could collect a $300 million bonanza this summer — depending on how things shake out.
Apparently, under the agreement whereby Legg Mason acquired Mr. Sherman’s company, Private Capital Management LP, back in 2001, he and the other principals of PCM would get this little bonus if PCM "reaches certain growth targets by next Aug. 1."
So, let’s think about this: As previously reported here, a large group of distinguished KR alumni in recent days distributed a letter asserting the seemingly controversial belief that good journalism is good business. The letter also said:
An investor who instead demands the sale or dismantling of Knight Ridder merely in the name of a larger profit margin is engaged not in good business but in greed.
That statement becomes more interesting in light of the Journal‘s story. So which is it: Is Mr. Sherman pressuring Knight Ridder because he thinks its papers need to do better journalism, or is he motivated by the $300 million bonus?
Good journalism, $300 million. Good journalism, $300 million. Hmmm. That’s a toughie.
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