{{Infobox company , name = Relational Investors LLC , type =

Private Private or privates may refer to: Music * " In Private", by Dusty Springfield from the 1990 album ''Reputation'' * Private (band), a Denmark-based band * "Private" (Ryōko Hirosue song), from the 1999 album ''Private'', written and also recorde ...

, foundation = 1996 , location =

San Diego California San Diego ( , ; ) is a city on the Pacific Ocean coast of Southern California located immediately adjacent to the Mexico–United States border. With a 2020 population of 1,386,932, it is the eighth most populous city in the United States ...

, founder = Ralph V. Whitworth, Co-Founder
David H. Batchelder, Co-Founder , industry =

Financial services Financial services are the Service (economics), economic services provided by the finance industry, which encompasses a broad range of businesses that manage money, including credit unions, banks, credit-card companies, insurance companies, acco ...

, products =

Asset Management Asset management is a systematic approach to the governance and realization of value from the things that a group or entity is responsible for, over their whole life cycles. It may apply both to tangible assets (physical objects such as buildings ...

Activist Investor An activist shareholder is a shareholder who uses an Equity (finance), equity stake in a corporation to put pressure on its management. A fairly small stake (less than 10% of outstanding shares) may be enough to launch a successful campaign. In com ...

, assets = $6 billion , homepage
www.rillc.com
Relational Investors is an

activist Activism (or Advocacy) consists of efforts to promote, impede, direct or intervene in social, political, economic or environmental reform with the desire to make changes in society toward a perceived greater good. Forms of activism range fro ...

investment fund An investment fund is a way of investing money alongside other investors in order to benefit from the inherent advantages of working as part of a group such as reducing the risks of the investment by a significant percentage. These advantages inc ...

based in

San Diego San Diego ( , ; ) is a city on the Pacific Ocean coast of Southern California located immediately adjacent to the Mexico–United States border. With a 2020 population of 1,386,932, it is the List of United States cities by population, eigh ...

California California is a U.S. state, state in the Western United States, located along the West Coast of the United States, Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the List of states and territori ...

. Founded in 1996 by Ralph V. Whitworth, the fund has $6 Billion in assets under management. The firm primarily invests in value stocks of companies with

market capitalization Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders. Market capitalization is equal to the market price per common share multiplied by t ...

of over $5 billion while charging a 1%

management fee In the investment advisory industry, a management fee is a periodic payment that is paid by an investment fund to the fund's investment adviser for investment and portfolio management services. Often, the fee covers not only investment advisory serv ...

and a 20%

incentive fee A performance fee is a fee that a client account or an investment fund may be charged by the investment manager that manages its assets. A performance fee may be calculated many ways. With respect to a separate account, it is often based on the ...

on returns above the

S&P 500 The Standard and Poor's 500, or simply the S&P 500, is a stock market index tracking the stock performance of 500 large companies listed on stock exchanges in the United States. It is one of the most commonly followed equity indices. As of D ...

. The fund tends to invest in specific target companies with the intent of exerting influence on management while getting its own board members elected. Typically, the fund looks for businesses with strong fundamentals and cash flows but are trading below their intrinsic value due to improper management.

Investment Strategy

Typically, Relational initiates a small stake in a target company of around $100 million. Then a request of audience is made to management and directors with a list of proposals to boost shareholder value. If the target company is receptive, Relational will build its position to 5% to 10% of the

equity Equity may refer to: Finance, accounting and ownership * Equity (finance), ownership of assets that have liabilities attached to them ** Stock, equity based on original contributions of cash or other value to a business ** Home equity, the dif ...

. If the company rejects Relational's advances, however, the firm typically will act on the threat of mounting a

proxy fight A proxy fight, proxy contest or proxy battle (sometimes even called a proxy war) is an unfriendly contest for the control over an organization. The event usually occurs when a corporation's stockholders develop opposition to some aspect of the corp ...

and going public with its proposals. The Fund typically pushes for large buybacks and dividends to shareholders.

External links

Relational Investors Official website

Business Week company profile

LinkedIn company profile
Financial services companies of the United States