Value-creating activist gets involved with a pure play in the growing animal health market

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Elanco is one of a few large, independent animal health companies and this type of company is very hard to build from scratch.

Sachem Head was founded in 2013 by Scott Ferguson, the first investment professional hired at Pershing Square where he worked for nine years. While Sachem Head has a history of solid value investing, their activism in their early years was short term and underwhelming at best.

The other possibility here, but not likely the core opportunity is a sale of the company. Elanco is one of a few large, independent animal health companies and this type of company is very hard to build from scratch without brand equity and a broad portfolio.

Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments. Elanco is owned in the fund.

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