MAJOR GREY GLOBAL INVESTOR SELLS STOCK

Brookside Capital Sells Half of Its Holdings

By Published on .

NEW YORK (AdAge.com) -- One of Grey Global Group's biggest investors unloaded about half its stock, taking profits now rather than waiting for Grey to sell the company.
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Brookside Capital Partners in recent weeks cut its stake to 3.7% from the 7.2% interest it owned at the end of March, according to a filing today with the Securities and Exchange Commission.

Third largest shareholder
Brookside Capital had been Grey's third largest shareholder, behind Chicago money manager Ariel Capital Management and Grey's chairman-CEO, Ed Meyer.

The investor's sell off isn't that surprising. Brookside, part of Boston private investment firm Bain Capital, invests in securities where it sees opportunities for long-term gains. Bain Capital's founder, Mitt Romney, in the past said the firm invested in Grey because it considered the advertising company undervalued and saw a chance that Grey one day would be sold, according to a knowledgeable individual.

Mr. Romney, now governor of Massachusetts, no longer is involved with Bain Capital. Brookside's managing director, Roy Edgar Brakeman III, hadn't returned a call at deadline.

Betting on profits now
In taking some money off the table, Brookside could be betting that most of the profits on Grey stock already have been made. Grey's stock price -- with a closing price of $879 today -- is little changed from late June, when media reports first surfaced that Grey was considering a sale. Grey confirmed last month that it had hired investment bankers to shop the company.

At least three possible buyers -- agency holding companies WPP Group and Havas and private-equity firm Hellman & Friedman -- are considering bids. But there so far is no sign of a bidding war that would send the stock significantly north of its current price.

Investment paid off
Brookside's long-term investment paid off. The stock traded below $400 a share in 1999, when Brookside disclosed its first Grey holding. Brookside's remaining 42,395 Grey shares are worth about $37 million.

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