Activist shareholder group gets its teeth into Microsoft

Activist shareholder group ValueAct Capital invested $US2 billion ($A1.93 bilion) overnight in Microsoft, triggering a four per cent spike in the share price amid speculation its move could presage an a owner-led shake-up at the company.

In the 13 years since Bill Gates stepped down from the CEO role to be replaced by Steve Ballmer critics have argued that the company has missed every big moment.

Facebook and Twitter own social media, Apple and Google own mobility, Google owns search , Amazon owns cloud and Microsoft owns... Windows.

Of course, unfashionable though that may be Microsoft still generated income of $US6 billion on revenues of $US19 billion last quarter.

But  now patience may have run thin with the executive management.

Still, if ValueAct's goal is to shake up the management and board it will need a lot of help as its current holding represents barely one per cent of the company stock, although it will still be one of the top 20 investors.

Ecommerce Times quotes Peter Cohan of Peter S. Cohan & Associates saying, "Essentially, ValueAct has taken one  percent if not less of Microsoft's market cap. That suggests that the company will not have a significant impact on Microsoft unless it is able to galvanize other shareholders to act with it to push for changes. "  

The move is a big bet by ValueAct – its biggest in fact easily eclipsing its $1.6 billion in Motorola Solutions. The company has said its agenda is to push Microsoft harder away from PCs and into the cloud.

According to Bloomberg, the investment outfit's CEO Jeffrey Ubben told a conference overnight, "In three to five years, which is our time horizon, we’ll stop talking about PC cycles and instead talk about Microsoft as the largest cloud-computing company in the world."

Microsoft reacted cautiously and predictably to the news with its board issuing a statement saying it welcomed the perspectives of investors and  was committed to enhancing value for all shareholders.