Activist Investors Acquire Stake in Franklin Street Properties Corp

Investing.com — Activist investors Converium Capital and Erez Capital Management have jointly taken a 6.8% stake in Franklin Street Properties Corp (NYSE:FSP), pursuing board representation due to their belief that the shares are "undervalued and represent an attractive investment opportunity."

In a Schedule 13D filed with the SEC on November 5th, the two funds reported respective stakes of 3.6% and 3.2%, and noted that they have engaged in discussions with the company regarding the composition of the Board, operations, capital allocation, and strategy.

Additionally, Converium has nominated Erez Capital’s CIO Bruce Schanzer to the FSP Board.

In comments to Investing.com, Schnazer, the former CEO and President of Cedar Realty (NYSE:CDR), mentioned that their objective is to identify discrepancies between the sum-of-parts value of a company’s holdings and its stock price. He indicated that he believes FSP shares are currently trading at a “substantial discount” compared to the value of its real estate and emphasized their commitment to unlocking this value.

As of now, Franklin Street Properties has not commented on the nominations from Converium and Erez. FSP shares closed at $1.95 yesterday and have dropped nearly 25% YTD.