JANA calls for divestiture of Markel Ventures, $2B Markel share repurchase

JANA Partners confirmed it has sent a letter to the board of directors of Markel (MKL) Group calling for a divestiture of Markel Ventures along with a $2B tender offer to repurchase shares ahead of such divestiture. JANA stated in part in the letter it made public: “While we support the Board’s efforts to buy back undervalued shares through the open market, it is limited by both Markel’s extremely low liquidity and by doing so without taking action to address Markel’s structural discount. We therefore call upon the Board to pursue a $2bn tender to retire its shares in parallel with a divestiture of Ventures. We understand the Board is also frustrated with Markel’s stock price performance and valuation. More Ventures disclosure and improving insurance performance were excellent first steps, but they have, not surprisingly, proven insufficient. Asserting to us that Markel’s stock ‘isn’t for everyone’ is not an acceptable answer… Rather than continuing to pursue a strategy that is not working, it is time for the Board to prioritize shareholder returns and unlock Markel’s value through a large-scale tender and subsequent divestiture of the Ventures business.”