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If You're Wondering Whether Paul Singer Would Stoop To Dragging CEOs' Children Into Activist Battles, Apparently You Don't Know Paul Singer

No one can escape the fell the hand of Singer.
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There are people you fuck with and people you don't fuck with. Firmly in the latter camp is Paul Singer. In the last year alone, Singer's Elliott Management has taken on the Dutch legal systemsent an army of mini-Singers to the homes of proxy votersshot a middle-finger at Warren Buffettused Jedi mind tricks to make an adversary's brain implode, and watched two major foreign leaders it has targeted fall in disgrace.


But this is just what's become public. Behind the scenes, Singer's tactics have reportedly been a whole lot more brutal. How brutal you ask? How about digging-up-dirt-on-executives'-children brutal. Take this scene, reported in a new Fortune profile, from Singer's highly publicized tangle with metals giant Arconic and its ill-fated CEO Klaus Kleinfeld:

The most unnerving incident was when one of Kleinfeld’s daughters, a student at Harvard Business School, was approached on campus by someone who asked to “friend” her on Facebook; the person also spoke to her friends, fishing for information about her family.

To be fair, Kleinfeld wasn't playing nice either. In the midst of the campaign, Kleinfeld caused a soccer ball to be delivered to Singer's office, along with a cryptic message referencing what was intended to be some embarrassing dirt: that Singer wore a feathered headdress and belted out “Singin’ In The Rain” in a public fountain during the 2006 World Cup in Berlin. The hedge fund called it blackmail and Kleinfeld got the boot.

But according to Fortune, the offspring of executives have come into play in multiple Elliott offensives:

On at least three occasions, according to both court testimony and the accounts of seven people who spoke with Fortune, children of people facing the hedge fund’s attack have been pulled into the fray in some way, in an apparent bid to gain either information on or leverage against their parents. In an instance involving Norbert Essing, an Arconic PR consultant in Germany, neighbors of his children in London received visits from people asking about drug abuse by them or their father. This happened shortly after Elliott publicly blamed Essing for helping or encouraging Kleinfeld to write his soccer ball letter. (Essing denies the accusation.)

Then there was the time a handful of execs from Elliott target Compuware traveled from Detroit to the Elliott's Manhattan office to meet with Singer's young attack-dog Jesse Cohn:

Cohn opened the meeting by casually flipping through a six-inch-thick manila folder of purportedly embarrassing information on his guests, which included former GM CEO Fritz Henderson. Bill Grabe, an advisory director at private equity firm General Atlantic who sat on Compuware’s board at the time, would later testify in arbitration proceedings that Cohn unabashedly brought Henderson’s daughter into the conversation. “And you know, you have a daughter that’s doing this and whatnot,” Grabe recalled Cohn saying, paraphrasing the young fund manager.

To those familiar with Paul Singer, none of this should be surprising, exactly. A guy who is willing to impound the warships of a sovereign nation isn't going to blush at sending a private dick to dig up scoops on the children of his opponents.

It's notable, also, that Elliott didn't send some horrified statement to Fortune denying the allegations or at least softening them a bit. Singer is well-aware of his reputation; it doesn't hurt his cause for potential adversaries to worry that rejecting his demands might mean some snoop crawling around Wharton trying get candid snaps of their eldest daughter doing a gravity bong. That's just business. These kids should have thought twice before being born to value destroyers.

Inside Elliott Management: How Paul Singer’s Hedge Fund Always Wins [Fortune]



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