City comment: SSE’s management should be wary of Elliott Advisors’ blasting tanks

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When Elliot targets a company, New York worker doesn’t park his tanks on the lawn—it starts to explode

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Of course, Elliott Advisors isn’t going silent.

The activist is starting an almighty fiasco after SSE refused to take his personal advice and spin-off its renewable business. Not only does the decision beggar trust, it questions the ability of the management to keep the SSE intact, we are told. It’s time to get some new directors who know what they’re doing, says Elliott.

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This is all textbook material. Paul Singer, the founder of Elliot Called “The World’s Most Dreaded Investor” And one profile noted his “uniquely adversarial” approach.

Elliot not only parks his tank on the lawn – it starts to explode.

An American worker could be behind the blasts. Investors around the world are struggling to put their money into green investing. Separating renewable energy can make it easier to attract cash. This would mean faster growth and more competitive businesses.

The SSE argues the exact opposite: A small, solitary business will struggle to raise as much money as possible. The combined balance sheet is its secret weapon.

Both sides have to explain to the investors. Elliott has a good number of numbers to hang in front of him: it believes its plan will take the shares from their current £16.27 to £21 – another £5 billion at market value.

The SSE stock didn’t jump much this morning, but is up 5% since news of Elliott’s involvement first broke. Let us inform that on the day it announced its new strategy, the SSE declined 4% on that day. Elliot can find many shareholders with a sympathetic ear.

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