Elliott Management owns big Dropbox stake, holds discussions

Activist investor Elliott Management owns a large stake in Dropbox and has been holding private discussions with the file-sharing service provider for some time, a source familiar with the matter said on Wednesday.

The hedge fund owns a stake of more than 10 percent, which is valued at more than $800 million, the person said, declining to reveal the exact size of the investment.

Dropbox, which was co-founded by Drew Houston who is currently the company’s chief executive officer, is valued at roughly $11 billion. The company, which allows users to store documents, videos and photos online, listed its shares in March 2018 at $21 a share.

A representative for Dropbox did not immediately respond to a request for comment.

On Wednesday, Dropbox was trading at $28.11, having jumped as much as 7 percent on news that Elliott has a stake and is holding discussions with management.

The Wall Street Journal first reported the stake.

Confetti showered Dropbox CEO Drew Houston and Dropbox co-founder Arash Ferdowsi (center) as they celebrated the launch of Dropbox's initial public offering in March 2018, ringing the opening bell at the Nasdaq.
It was celebratory for Dropbox in March 2018 when its CEO Drew Houston and co-founder Arash Ferdowsi (center) rang the opening bell at the Nasdaq in honor of the company’s IPO. News of Paul Singer’s Elliott Management owning a large stake in the company sent shares of the stock soaring Wednesday.
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Elliott has previously worked with companies that were being led by founders, including Twitter and SoftBank Group.

The hedge fund invests roughly $40 billion and currently owns stakes in Duke Energy, where it has urged the company to consider splitting into three companies, and drugmaker GlaxoSmithKline.