Starboard Value Losing Patience With RealD

Activist hedge fund Starboard Value disclosed a 9.9 percent stake in RealD (NYSE: RLD) on October 1. At the same time, the fund offered to acquire the remainder of the company it did not already own for $12 per share, a 29 percent premium to the October 1 closing price.

The following day, RealD said it will review the buyout offer with its advisers. Starboard Value has since waited patiently for a response which ultimately never came.

In a letter to RealD's Board of Directors on Wednesday, Starboard wrote that "you have neither provided us with any meaningful feedback, nor shown any willingness to engage with us, regarding our proposal."

The activist hedge fund adds that it is surprised and disappointed in RealD's lack of communication and that "not a single shareholder" it has spoken to is in favor of the company ignoring the takeout proposal and returning to business as usual.

The activist fund further warns the company, "While we believe it would be in everyone's best interest to engage privately and constructively to explore a potential transaction, we must, however, reserve all of our rights to take any action we deem necessary in furtherance of our Proposal."

Shares of RealD were trading in positive territory Wednesday afternoon prior to Starboard Value's letter released to the public. Shares then dipped in to negative territory and were last seen at $11.10, down 1.60 percent on the day. Shares are up 15 percent over the past month.