This Hedge Fund Manager Made $600 Million In 21 Months Off Yahoo

Hedge funder Dan Loeb and Third Point sold 40 million shares of its stake in Yahoo today. It brings to a close one of the most successful activist investor periods in tech.

Steve Marcus / Reuters

Dan Loeb’s hedge fund Third Point sold 40 million shares of Yahoo today, bringing a close to a whirlwind year of activist efforts to change the company and giving Third Point more than $1 billion off the sale.

Loeb first bought a huge stake in Yahoo in September 2011, urging for change at a board level for the company. Throughout the fund’s ownership period, Loeb worked to remove former CEO Scott Thompson over a discrepancy with his resume — which led to the hiring of Googler Marissa Mayer as CEO.

During Mayer’s first year as CEO, Yahoo’s stock was up more than 80%, trading today around $28 to $29. It was around $14 to $15 when Third Point bought its stake of Yahoo. That nets the hedge fund around $600 million. Loeb, along with Harry Wilson and Michael Wolf — who were appointed to the board — will all resign by the end of the year.

That’s not all Loeb and his partners have made, either. During his tenure on the board, Loeb was also compensated $56,154, according to a regulatory filing with the SEC. Affiliates Harry Wilson and Michael Wolf were compensated $282,753 and $292,989 respectively, including both cash and stock awards.

Strategy aside, there’s certainly something to be said about having good timing. There’s still some debate over whether Yahoo’s massive jump in share price in Mayer’s first year is a result of excitement over its stake in Alibaba, or because of what Mayer has done for the company.

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