Glenview Capital Discloses a Nearly 10% Stake in Omnicare (OCR)

In a 13D filing after the close on Omnicare, Inc. (NYSE: OCR), Glenview Capital Management disclosed a 9.97% stake 12,122,463 in the company. The firm held 3,718,741 shares at the quarter ended June 30, 2007.

In a pretty standard disclosure, the firm did not make any direct requests on the company, but said they will monitor their investment and may enter discussions with management, the Board of Directors or others.

ValueAct Capital, another activist fund, disclosed a 6.5% stake in Omnicare back in September.

ValueAct Capital Raises Stake in Equifax (EFX) to 5.3%

In a 13D filing on Equifax Inc. (NYSE: EFX), ValueAct Capital disclosed a 5.3% stake (7,523,768 shares) in the company. This is up from the 2,926,765 share stake the firm held at the quarter ended June 30, 2007.

In a pretty standard disclosure, ValueAct did not make any direct requests on Equifax, but said they will monitor their investment and may enter discussions with management, the Board of Directors or others.

Saks (SKS) Holder Jon Asgeir/Baugur Interested in Acquisition Proposal

In an amended 13D filing on Saks Incorporated (NYSE: SKS), Johannesson Jon Asgeir/Baugur disclosed an 8.5% stake (12,210,000 shares) in the company. Jon Asgeir noted that after purchasing the shares and becoming more familiar with the company, including through meetings with members of management, they determined that it would like to explore the possibility of making a proposal for the acquisition of the company.

Baugur expects to seek to engage in discussions with management and members of the Board of Directors with respect to a possible acquisition of the Issuer. In addition, Baugur has consulted with financial and legal advisers and expects to hold discussions with Landmark and other third parties with respect to the financing of a possible acquisition.

From the Filing:

Baugur purchased the shares as part of its global investment portfolio and believes them to represent a sound acquisition. After purchasing the shares and becoming more familiar with the Issuer, including through meetings with members of the Issuer’s management, Baugur determined that it would like to explore the possibility of making a proposal for the acquisition of the Issuer. In furtherance of the foregoing, Baugur has had exploratory discussions with Milestone Resources Group Limited (Landmark), which is currently a shareholder of the Issuer and principally owned by Micky Jagtiani, the principal owner of the Landmark Group, to explore the possibility of making a joint proposal with Landmark and/or one or more affiliates of Landmark for the acquisition of the Issuer.

Baugur expects to seek to engage in discussions with the Issuer’s management and members of the Issuer’s Board of Directors with respect to a possible acquisition of the Issuer. In addition, Baugur has consulted with financial and legal advisers and expects to hold discussions with Landmark and other third parties with respect to the financing of a possible acquisition. In connection with these efforts, Baugur or its affiliates may seek to enter into agreements, arrangements or understandings with other shareholders of the Issuer, including Landmark, with regard to such shareholders’ shares or other matters that relate, directly or indirectly, to Baugur’s current intent to explore a possible proposal for the acquisition of the Issuer. In addition, Baugur may seek to engage in discussions with management of the Issuer concerning the business and/or operations of the Issuer and/or concerning potential investments by Baugur in securities of the Issuer and/or its subsidiaries. Such discussions may relate to one or more of the transactions specified in clauses (a) through (j) of Item 4 of Schedule 13D. Baugur or its affiliates may also submit to the Issuer one or more indications of interest, orally or in writing, with respect to a possible transaction.

Although Baugur is currently actively exploring its options with respect to the Issuer, there can be no assurances that Baugur will seek to implement any one or more of the foregoing actions and Baugur expressly reserves the right to change its intentions with regard to the Issuer.

Depending on prevailing market, economic and other conditions, Baugur may from time to time acquire additional securities of the Issuer, convert or exchange securities that it holds, engage in discussions with the Issuer concerning further acquisitions of securities of the Issuer or otherwise invest in the Issuer or one or more of its subsidiaries. Baugur intends to review its investment in the Issuer on a continuing basis and, depending upon the price and availability of the Issuer’s securities, subsequent developments concerning the Issuer, the Issuer’s business and prospects, other investment and business opportunities available to Baugur, general stock market and economic conditions, tax considerations and other factors considered relevant, may decide at any time to increase or decrease the size of its investment in the Issuer or to sell any or all of the securities of the Issuer that it holds.

Other than as set forth above, none of Mr. Jón Ásgeir Jóhannesson, Baugur nor, to the best of its knowledge, any of Baugur’s executive officers or directors listed in Schedule A have any present plans or proposals that relate to or would result in any transaction, change or event specified in clauses (a) through (j) of Item 4 of Schedule 13D.

Monarch Activist Partners Wants Penn Treaty American (PTA) To Hire a Banker for a Potential Sale

In 13D filing on Penn Treaty American Corp. (NYSE: PTA), Monarch Activist Partners LP disclosed a letter to the company stating, "Due to continued delays in filing the company's GAAP financials, as well as the recently announced restatement of prior earnings, we believe it is time for Penn Treaty's Board of Directors to immediately hire an investment banker to explore strategic alternatives, including the potential sale of the company."

Monarch believes Penn Treaty American shares are worth north of $10 per share. Penn Treaty American closed at $6.16 per share Friday.

The firm also said the recent vacancy on the board should be filled by a shareholder and the board should be reconstituted with shareholder friendly Directors.

A Copy of the Letter:

Dear Mr. Woznicki (Chairman):

This letter is a follow-up to correspondence dated June 8, 2007, between Monarch Activist Partners (Monarch) and the management and Board of Penn Treaty American Corp. ("PTA") regarding PTA's inability to file on a timely basis its Form 10-K for the year ended December 31, 2006. We notified the Board at that time that we would make our displeasure public if the situation was not rectified within a reasonable period of time.

Due to continued delays in filing the company's GAAP financials, as well as the recently announced restatement of prior earnings, we believe it is time for Penn Treaty's Board of Directors to immediately hire an investment banker to explore strategic alternatives, including the potential sale of the company.

Monarch believes PTA shares are worth north of $10 per share (applying a conservative 1.0x book value multiple- which would be closer to $11+ based on an improving book value in 2007) and the only near term way for shareholders to receive fair value is through the sale of the company. In conversations with other PTA shareholders as well as professionals in the industry, we believe that since the company is current in its statutory filings (including the 2006 Statutory Audit signed off on by BDO Seidman), a sale of the company would not be dependent upon the GAAP financials.

We believe PTA's Directors are in breach of their fiduciary responsibility by letting the financial reporting issues persist indefinitely without pursuing strategic alternatives. If PTA does not hire an investment banking firm to pursue alternatives and add shareholder representatives to the board immediately we intend to take action to unseat the board in the next shareholders' meeting. We do not make these threats lightly and regret the board has put its investors in this situation.

Additionally, with the recent resignation of Chairman Gary Hindes, a vacancy exists on the company's board. This vacancy should be filled by a shareholder of the company and the board should be reconstituted with shareholder friendly Directors.

Sincerely,
James Chadwick

Managing Partner, Monarch Activist Partners

Shamrock Activist Value Fund Accumulates 5% Stake in Websense (WBSN)

In a recent 13D filing on , Shamrock Activist Value Fund disclosed a 5.03% stake in Websense (Nasdaq: WBSN).

In a pretty standard disclosure, Shamrock did not make any direct requests on the company, but said they will moniter the investment and may buy or sell stock accordingly. The firm has no plans which would related to paragraphs (a) through (j) of this Item 4 to the form Schedule 13D

Shamrock Activist Value Discloses 6.6% Stake in

In a recent 13D filing, Shamrock Activist Value Fund disclosed a 6.59% stake in Jackson Hewitt Tax Service Inc. (NYSE: JTX).

Shamrock said it has had, and anticipates having further, discussions with the Company’s Board of Directors and senior management regarding ideas to enhance shareholder value.

Shamrock has proposed that the Company adopt changes to the current executive compensation plan, declassify its staggered Board and use its capital resources to expand the Company’s stock repurchase activities.

Large Magellan Health (MGLN) Holder Shamrock Activist Value Fund Requests $12/Share Special Dividend

Shamrock Activist Value Fund, a 4.6% holder of Magellan Health Services, Inc. (Nasdaq: MGLN), disclosed a letter sent to the company in a press release this afternoon. The firm recommend that the Board should authorize a one-time special dividend of $478 million or approximately $12.00 per share.

In its letter to Magellan Health Services, the firm said, "Based on our conversations with shareholders that represent approximately 50% of outstanding shares of the Company, we believe that a return of excess capital at this time would be well received. While some of these shareholders may differ on a preferred method for returning capital (namely, special dividends vs. share repurchases), all agree that the current balance sheet is sub-optimal and is suppressing shareholder returns."

A Copy of the Letter:

Dear Directors,

Shamrock Activist Value Fund currently owns 1,822,878 shares of Magellan Health Services, Inc. (Nasdaq: MGLN) common stock or approximately 4.6% of its outstanding shares, which places our fund among the largest owners of the Company. We have been shareholders of Magellan since January 2006 and have spent considerable time researching the Company, its industry, and its competitors.

Until recently, we had been supportive of management's strategy to pursue acquisition opportunities that seek to capitalize on the Company's core competency in healthcare administration in a managed care environment. With the acquisitions of NIA and ICORE at a cost of $408 million over the last 18-months, we believe it is now appropriate for management and the Company to focus primarily on successfully integrating these two businesses. Early indications suggest NIA is roughly tracking to plan and ICORE's performance is lagging acquisition projections. We find it reasonable for shareholders to expect financial results that demonstrate that the Company's strategy is one that can create value for shareholders. Until that time, we believe it imprudent for the Board to endorse additional acquisition activity.

We believe that the Board has the opportunity to dramatically improve shareholder value by taking immediate action to optimize the Company's balance sheet. The Company's current forecast projects $12 million of debt and approximately $315 million of unrestricted cash at year end. Moreover, management indicated on the July 27 conference call that it has access to approximately $1.25 to $1.50 billion of capital from cash on hand and available debt capacity. We agree with management's assessment. Clearly, Magellan has the financial flexibility to add reasonable leverage to its balance sheet, return a portion of its excess capital to shareholders, while retaining adequate liquidity to pursue opportunistic acquisitions. Therefore, we recommend that the Board should authorize a one-time special dividend of $478 million or approximately $12.00 per share.

Enclosed for your review is a brief summary of the proposed transaction. A copy of this presentation can be found on our website at www.shamrock.com/pages/activist/MGLN_Dividend_Recap.pdf.

Based on our conversations with shareholders that represent approximately 50% of outstanding shares of the Company, we believe that a return of excess capital at this time would be well received. While some of these shareholders may differ on a preferred method for returning capital (namely, special dividends vs. share repurchases), all agree that the current balance sheet is sub-optimal and is suppressing shareholder returns.

Over the last few months we have had multiple discussions with Company management about capital management. We were initially encouraged by management's comments on the April 27, 2007 conference call:

"...acquisition opportunities are the first, second and third agenda items in terms of capital deployment to maximize shareholder value. However, we are considering ways to make the balance sheet more efficient, given the pipeline of acquisition opportunities and the inefficiency of the balance sheet."

Three months later, on their July 27, 2007 conference call, management's tone and message changed:

"We believe it is prudent to maintain our current capital position. In addition, as Mark has just discussed, our cash needs for the business are fairly significant in '07. Given the current incremental usage of cash for a new business and our active acquisition review, we have decided at this point in time not to implement any capital deployment strategies this quarter but we will continue to review and assess this possibility on an ongoing basis as we have stated to you previously."

Given the Board's decision to take no action with respect to capital management, we requested on August 9th and again via a letter to the Board of Directors on September 18th, to meet with one or all of the independent Board members to share our analysis and thoughts. We have been disappointed by the Board's decision to not meet and engage with us in a discussion concerning this issue. Given the lack of response and what we believe is an ongoing risk factor and drag on the Company's valuation, we are left with no choice but to make our concerns public.

We again request a meeting with any or all of the independent Board members to discuss this important issue at Magellan.

Respectfully,

Arik Ahitov

Estate of Ameristar Casinos (ASCA) Founder Neilsen Will Evaluate Strategic Alternatives

In an amended 13D filing on Ameristar Casinos Inc. (Nasdaq: ASCA) this morning, the Estate of Craig H. Neilsen, and its Co-Representatives, disclosed a 55.2% stake in the company. The Estate, and its Co-Representatives noted that since the passing of Craig H. Neilsen, said they have undertaken and will continue to evaluate strategic alternatives that may become available with respect its holdings in the Company. The estate said alternatives may include: (1) a merger or other form of business combination or extraordinary or other negotiated transaction, (2) a transaction involving the Company’s transfer or disposition of a material amount of assets and (3) open market transactions in the Company’s Common Stock.

From the filing:

"While the Co-Representatives are under no current compulsion to engage in any transaction or support any transaction by the Company, on the basis of their ongoing review and evaluation, the Co-Representatives may at any time determine with or without additional notice to support or pursue one or more strategic alternatives to maintaining the Estate’s current ownership of the Shares, including without limitation engaging in sales of all or part of the Estate’s holdings or participating in a transaction or series of transactions or taking other actions with the purpose or effect of influencing or changing control over the Company. Such alternatives may include, without limitation, (1) a merger or other form of business combination or extraordinary or other negotiated transaction, (2) a transaction involving the Company’s transfer or disposition of a material amount of assets and (3) open market transactions in the Company’s Common Stock. There is no assurance, however, whether or when any transaction may result from the Co-Representatives’ ongoing review and evaluation.

In connection with their ongoing review, the Co-Representatives, in their representative capacities, may discuss, evaluate and explore with other members of management and the board of directors of the Company, and express their views and provide advice concerning, the Company’s business and operations, the value of the Company and its businesses, potential strategic alternatives and opportunities that may enhance shareholder value, and other issues that might affect the Co-Representatives’ evaluation of alternatives. In addition, as directors and officers of the Company, Ray H. Neilsen and Gordon R. Kanofsky may have influence over the corporate activity of the Company, including activity which may relate to transactions described in subparagraphs (a) through (j) of this Item 4."

Ramius Capital Nominates Four To A. Schulman (SHLM) Board

In a 13D filing today A. Schulman (Nasdaq: SHLM), Ramius Capital disclosed a 7.6% stake (2,062,795 shares) in the company. The firm showed it owned 127,501 shares in SHLM quarter ended June 30, 2007. A 13D indicates an 'active investment'.

Ramius Capital is trying to get four people included Jeffrey Solomon, Mark Mitchell, Michael Caporale, Jr. and Lee Meyer elected to the board at the 2007 Annual Meeting.

Sandell Expresses Concerns Ahead of Plains Exploration's (PXP) Merger With Pogo

In a 13D filing on Plains Exploration & Production Company (NYSE: PXP), Sandell Asset Management disclosed an 5.1% stake in the company and a letter to the Chairman Mr. James Flores. In the letter, Sandell said while it is inclined to support the Pogo (NYSE: PPP) transaction, it is concerned by Plains' management's inability to provide a strategic plan for the combined company post-closing.

Sandell urges a number of actions immediately after the close of the transaction including: 1. divestitures, with proceeds dedicated to buybacks; 2. the creation of a MLP (Master Limited Partnerships); 3. Aggressive share repurchases.

In its letter Sandell said, "we are confident that undertaking the actions listed above will result in dramatic value creation for all shareholders of up to $90 per share."

A Copy of the Letter:

Dear Jim: (CEO)

As you are aware, Sandell Asset Management Corp. and certain funds managed by Sandell, are the beneficial owners of approximately 3.7 million shares of Plains Exploration stock, representing 5.1% of the shares outstanding and making our firm one of the largest owners of PXP stock. We would like to thank you for the time you have spent with our team in the past two months discussing both the proposed Pogo transaction and your longer term plans for value creation at PXP.

As you probably know based on our recent meetings and conference calls, while we are inclined to support the Pogo transaction, we are concerned by your inability to provide a concrete plan for the combined company post-closing. Adopting a “buy and hold” plan for the Pogo assets would serve only to increase the risk level at PXP with little incremental value. Given the impact that the Pogo deal will have on PXP, we consider a detailed value realization plan vital. At a minimum, this plan must include elements of the following:

1. Asset sales – In the current high oil price environment, we believe that value is better created by selling rather than buying oil reserves. It is our belief that the economic rationale for merging with Pogo is dependent on being able to sell reserves at values significantly higher than the implied per barrel purchase price. Given the recent volatility in equity and financing markets, we think that it is crucial that you effectuate significant asset sales in a timely fashion. We feel very strongly that PXP should immediately prepare for a large asset divestiture in the 4th quarter of 2007 with all sale proceeds dedicated to share repurchases. Further, the company should continue to opportunistically monetize Gulf of Mexico reserves and non-core assets consistent with management’s prior commitments.

2. MLP creation - Prior to the announcement of the Pogo deal, you indicated that PXP was reviewing the formation of an MLP for virtually all of the reserves in California and the Piceance basin. In anticipation of this potentially significant transaction, PXP’s stock price appreciated into the mid-$50 range while oil was trading below $65 per barrel. After the announcement of the Pogo transaction, PXP’s shares virtually collapsed to $35 per share only recovering to $50 per share with the benefit of oil at approximately $90 per barrel. Most other oil weighted E&P companies are reaching new highs while PXP’s stock price continues to underperform dramatically. As an example, Encore Acquisition Company (EAC), which detailed plans for an MLP offering in the 1st quarter of 2007 completed that MLP IPO recently and has performed very well, exhibiting share price appreciation exceeding 43% thus far in 2007. By comparison, PXP’s stock over the same period is up only 5%. It is our opinion that had PXP simply followed its original plan of forming its own MLP and opportunistically monetizing assets, the share price would be materially higher at this point. Since the announcement of Pogo, we have heard varying commentary from you regarding the formation of an MLP. In your recent press release dated 10/9/07, the language on MLP formation remained vague, doing little to inform PXP investors. Since an MLP IPO takes several months to complete, investors need a definitive plan and timetable for MLP creation and drop-downs by which management can be held accountable.

3. Stock repurchases – Historically, PXP has been an aggressive purchaser of its own shares, successfully driving the creation of shareholder value through June 2007 just prior to the Pogo announcement. We are concerned that potential complications related to the Pogo transaction or an unwillingness to repurchase shares may contribute to further share price underperformance. Further, if assets are not divested in a timely fashion following the close of the transaction, we are concerned that PXP will become constrained by capital improvements required to improve the Pogo assets and that management may focus more on debt reduction than on the return of cash to shareholders. We insist that aggressive share repurchases be a key part of the value realization plan going forward.

We are confident that undertaking the actions listed above will result in dramatic value creation for all shareholders of up to $90 per share (+80%). We believe the market unnecessarily discounts PXP’s value by using unrealistically low commodity price assumptions and giving little credit for unproved and non-core assets. Furthermore, despite the attractiveness of PXP’s assets for an MLP, the market is also unwilling to assign pro-forma MLP values to PXP’s reserves. We do not believe this misperception will change until value is crystallized through asset sales, MLP formation and stock repurchases.

TABLE

In our opinion, the recent hiatus in your impressive record of value creation is a result of the lack of communication and confusion in the market regarding the plan for the combined company post-closing, including the timetable for asset sales and an MLP. While we are sensitive to the legal issues surrounding your ability to provide certain details pre-closing, it is our belief that we and our fellow shareholders will be far less understanding in the future should the company fail to produce a concrete plan and take action immediately after closing.

We look forward to continuing a constructive dialogue with you regarding the Pogo transaction and opportunities to enhance value at PXP. Please feel free to contact us at 212-603-5700 at your convenience.

Thomas E. Sandell

Chief Executive Officer
Sandell Asset Management

Dubai Group Looks To Court Orient-Express (OEH)

Orient-Express Hotels Ltd. (NYSE: OEH) has a lot of unwanted suitors. Will the company be forced into a deal?

In a 13D filing, released this afternoon, Dubai Investment disclosed a 9.2% stake in the company and said it offered $60 per share to acquire the company, which it said was rejected.

Dubai Investment said it has been aggressively acquiring shares in Orient-Express following disclosure from another group, The Indian Hotels Company, that it holds a large stake in the company and was interested in a deal.

Orient-Express issued a public statement on the Indian Hotels deal, saying it was not interested.

Dubai Investment said if a third party makes an offer for the company, they may counter.

From the filing:

The Reporting Persons and their affiliates have been following the Company for a period of time as a potential investment or business combination opportunity. On several occasions in the last few months, representatives of the Reporting Persons have contacted the Company regarding the development of a joint strategy and possible transaction involving the Company and the hospitality assets of Jumeirah Group, an international luxury hotel chain and an affiliate of the Reporting Persons. In that connection, on September 10, 2007, an affiliate of the Reporting Persons proposed to the Company a transaction in which an affiliate of the Reporting Persons would have, subject to the approval of the Company’s Board, acquired all outstanding Class A Common Shares at a price of $60 per share in cash. The Company responded that it had no interest in pursuing such proposal.

Subsequently, another shareholder of the Company reported the acquisition of 10% of the Class A Common Shares and indicated its interest in a strategic transaction involving the Company. After the Company publicly announced that it had no interest in entering into a transaction with the shareholder, the Reporting Persons began acquiring the Shares in order to prevent this other shareholder from acquiring a significant stake in the Company. If a third party makes an offer for the Company or enters into an agreement with the Company or any affiliate thereof to acquire all or a majority of the capital stock or assets of the Company, the Reporting Persons may consider making an offer to acquire control of the Company, subject to its consideration of all relevant factors and circumstances (such as the price offered by the third party, the condition of the business of the Company at such time, and any other factors and circumstances that the Reporting Persons may consider relevant at such time).

Clinton Group Discloses 5.1% Stake in Steven Madden, Urges Buyback

In a 13D filing on Steven Madden (Nasdaq: SHOO), Clinton Group disclosed a 5.1% stake (1,077,486 shares) in the company. The firm did not show a stake in SHOO at the quarter ended June 30, 2007. A 13D indicates an 'active investment'.

An excerpt from the letter from the Clinton Group to Steven Madden's Chairman and CEO, Mr. Jamieson Karson is below.:"The Company has substantial, unrestricted cash balance, which we estimate will grow to be at least $90 million by year end, representing approximately 22% of the current market capitalization. Clearly, this is an inefficient capital structure given the Company's free cash flow generation, ongoing strong earnings, and limited capital expenditure requirements. We believe that $72 million of this cash, combined with a modest senior debt financing of $110 million, could be used to purchase 40% of the outstanding shares of the Company, resulting in pro forma leverage of 1.5x net debt to 2007E EBITDA. The Company could execute such a buyback at a range above $21.00 per share or a 13.5% premium to current market prices. The extraordinary accretion from this transaction produces implied stock prices well north of current levels and a premium to our proposed tender price of greater than 20%."

A Copy of the Letter:

Dear Mr. Karson: (Chairman/CEO)

We enjoyed our recent conversation with you regarding the business prospects and strategy of Steven Madden, Ltd. (the "Company" or "Steven Madden"). First and foremost, we are aware that Steven Madden is operating in a weaker consumer environment where the lack of new trends in shoe merchandise is exacerbating tough comparisons against a successful year in 2006. The Company seems to have made great strides in improving operating practices, attracting key design talent, and implementing effective inventory processes. Additionally, the acquisitions of Daniel M. Friedman and the e-commerce business should add value in view of their accretion and diversification of the Company's business model.In summary, based on our industry diligence to date, the brand scores high among its targeted market and is the strongest it has ever been.

We believe the market has misunderstood the prospects of the business, and have taken a 5.1% ownership position because we believe the Company's stock price movement over the past two months presents an attractive entry point into a superior consumer-branded company. Even assuming a difficult inning for consumer spending, Steven Madden is trading at historically low valuation multiples (5.1x2007E EBITDA) and at a valuation discount to comparable companies. Recent relevant precedent transactions occurred in the range of 10x to 13x EBITDA,which represents a tremendous premium to Steven Madden's valuation, even after accounting for the change of control premiums paid.(1)

When we last spoke, we discussed several alternatives that we thought the board should consider to enhance shareholder value. While we presented a number of options and their respective merits, we believe that the alternative with the best risk/return characteristics would be for the Company to pursue a Dutch Tender of $180 million to repurchase Company shares. Our rationale for strongly urging the Company to pursue this alternative is as follows:

The Company has substantial, unrestricted cash balance, which we estimate will grow to be at least $90 million by year end, representing approximately 22% of the current market capitalization. Clearly, this is an inefficient capital structure given the Company's free cash flow generation, ongoing strong earnings, and limited capital expenditure requirements. We believe that $72million of this cash, combined with a modest senior debt financing of $110million, could be used to purchase 40% of the outstanding shares of the Company,resulting in pro forma leverage of 1.5x net debt to 2007E EBITDA. The Company could execute such a buyback at a range above $21.00 per share or a 13.5%premium to current market prices. The extraordinary accretion from this transaction produces implied stock prices well north of current levels and a premium to our proposed tender price of greater than 20%.

Although the Board has authorized a sizeable share repurchase program, we believe a Dutch Tender combined with a modest debt financing has a more significant impact, providing enhanced financial leverage to shareholders who,like Clinton Group, believe in the long-term prospects of the business.

In summary, we believe that the Steven Madden brand has never been stronger, and we believe that the management team and board share this view. That strength,and the Company's balance sheet, makes this an optimal time to seize an opportunity to enhance shareholder value. We hope you find our proposal constructive and expect the Company's board of directors to consider this proposed transaction in the upcoming board meeting. Please feel free to contact me at your convenience at (212) 739-1833 to discuss any and all issues. We look forward to hearing from you.

Joseph A. De Perio

Vice President

Loeb's Third Point Lowers Stake in PDL BioPharma (PDLI) to 5.1%

In an amended 13D filing on PDL BioPharma, Inc. (Nasdaq: PDLI), Daniel Loeb's Third Point LLC disclosed a 5.1% stake (6,000,000 shares) in the company. This is down from the 9.7% stake (11,300,000 shares) he disclosed in a prior filing.

Third Point sent a letter to the Board of Directors in which it acknowledged positive developments relating to the Company's announced intentions to commence a sale process but expressed concern that the Board does not include a Third Point representative and that the Company is being led by L. Patrick Gage as Interim Chief Executive Officer. In the letter, Third Point reiterated its belief that the shares remain undervalued and stated that, as one of the Company's largest shareholders, it will be carefully tracking developments at the Company and assessing its options.

A Copy of the Letter:

PDL Board Members:

We are encouraged by PDL's October 1st press release announcing that the Board will actively seek the sale of the entire Company or all of its component pieces. We are also pleased with the progress apparently being made by the Merrill Lynch investment bankers in spear heading this process and advancing it expeditiously to a successful conclusion.

Despite these positive developments, we are disappointed that the sale process is still being led by a Board that does not include a Third Point representative, and that Patrick Gage remains the Company's CEO, despite having demonstrated his unsuitability. Accordingly, although we remain convinced that PDLI shares are undervalued, and that a sale will maximize shareholder value, in light of your continuing refusal to provide us with a voice in the Company's affairs through a Board seat, we have reduced our position.

Despite the reduction in our PDLI position, we have maintained a holding above the 13D filing threshold, and remain one of the Company's largest shareholders. We will be carefully watching developments, and assessing our options, as events unfold.

Sincerely,
Daniel S. Loeb

Children's Investment Fund Sends Letter To CSX Urging Improvement in Governance and Biz Performance

This morning, The Children's Investment Master Fund, a 4.1% holder of CSX Corp. (NYSE: CSX), delivered a letter to the CSX Board of Directors urging it to act immediately and voluntarily to improve the company's corporate governance and business performance.

The fund called on the CSX Board to: separate the Chairman and CEO roles, add new independent directors, allow shareholders to call special meetings, align management compensation with shareholder interests, present a detailed operating plan with specific long-term operational and cost targets to address under-performance, Justify 2007-2010 capital spending plan, and improve relations with labor, shippers and shareholders.

A Copy of the Press Release:



The Children's Investment Master Fund ("TCI"), a long-term value investor which owns 17.8 million shares, or approximately 4.1%, of CSX Corporation (NYSE: CSX), today sent a letter to the CSX Board of Directors urging it to act immediately and voluntarily to improve CSX's corporate governance and business performance. Specifically, TCI called on the CSX Board to:

-- Separate Chairman and CEO roles. TCI believes, and it is widely recognized, that this is best practice in corporate governance. TCI is concerned that Chairman and CEO Michael Ward's interests are not aligned with those of CSX shareholders.

-- Refresh Board with new independent directors. The CSX Board has many longstanding directors and virtually no railroad management experience, which leaves the Board effectively unable to challenge management and provide appropriate oversight. CSX's Board should be refreshed with new independent directors with the experience and courage to do so.

-- Allow shareholders to call special meetings. The Board should amend CSX's bylaws to allow shareholders to call special meetings, a shareholder proposal that was approved overwhelmingly by shareholders at CSX's last annual meeting.

-- Align management compensation with shareholder interests. Michael Ward has been the highest compensated CEO in the rail industry over the past two years, despite CSX being operationally outperformed by its peers. TCI urges the Board to align management compensation with shareholder interests. This includes tying long-term compensation to returns on capital rather than to the operating ratio, which can be easily manipulated.

-- Present plan to improve operations. CSX is last or near last among the five major North American railroads on virtually every important operational and financial metric. CSX must present to shareholders a detailed operating plan with specific long-term operational and cost targets to address this under-performance. The existing operating ratio targets can be achieved with no operational improvements.

-- Justify 2007-2010 capital spending plan. TCI believes shareholder value is created through sustainable investment in maintenance, infrastructure and training. TCI is concerned that management's current illogical and undisciplined capital spending plan puts at risk CSX's ability to invest long-term because it undermines shareholder confidence and therefore access to capital.

-- Improve relations with labor, shippers and shareholders. TCI believes the Board and management have taken an unnecessarily adversarial approach to these key constituencies, resulting in strained relations instead of collaborative solutions. TCI believes the interests of the major stakeholders are largely aligned, and success is best achieved through open and constructive relations with them.

For further information and graphics included in the letter sent today to the Board of Directors of CSX, please visit www.strongerCSX.com.

What's Next For Icahn Following His BEAS and BIIB Windfall?

Given activist investor Carl Icahn's recent "golden touch", in light of last week's BEA Systems (Nasdaq: BEAS) buyout offer and the Biogen (Nasdaq: BIIB) sale news, we took a close look at Icahn's portfolio to see if there are any other potential companies that could be activist/takeover targets. Two companies from Icahn's portfolio that grabbed our interest were Enzon Pharmaceuticals Inc. (Nasdaq: ENZN) and Global Payments Inc. (NYSE: GPN).

Icahn initiated a 1,740,001 share stake in Enzon (3.95%) and a 1,008,779 share stake (1.3%) in Global Payments as of the quarter ended June 30, 2007.

Enzon is a biopharmaceutical company, an area Icahn has had great success. Icahn's successes in the area have included: ImClone (Nasdaq: IMCL), were he is Chairman; MedImmune - which was acquired by AstraZeneca PLC (NYSE: AZN); and Biogen (Nasdaq: BIIB) - which on Friday announced it is for sale.

Global Payments provides payment processing and consumer money transfer services worldwide. The company had been seen as a possible LBO target, before the leveraged takeover boom was brought to a halt due to the credit woes.

Former Children's Place (PLCE) Chairman/CEO Dabah Considers a Takeover Offer

In a 13D filing on The Children's Place Retail Stores (Nasdaq: PLCE), Former Chairman/CEO and 17.9% holder, Ezra Dabah, and related parties are considering the possibility of making an offer, in combination with others, to acquire the Company and the available alternatives for financing an acquisition of the Company.

Dabah intend to contact and discuss with potential private equity sponsors and strategic buyers the possible acquisition of the Company. The Reporting Persons have engaged Bear, Stearns & Co. Inc. as financial advisor.

Ezra Dabah is the former Chairman of the Board and Chief Executive Officer of the Company. He currently serves as a member of the Company's Board of Directors. Pursuant to mutual agreement with the Board of Directors, Mr. Dabah resigned from his position as Chief Executive Officer on September 24, 2007 and the Company appointed an Interim Chief Executive Officer.

From the filing:

"The Reporting Persons, as large, long-time and concerned stockholders of the Company, are considering their alternatives with respect to their investment in the Company and possible means to maximize shareholder value. The Reporting Persons are considering the possibility of making an offer, in combination with others, to acquire the Company and the available alternatives for financing an acquisition of the Company. The Reporting Persons intend to contact and discuss with potential private equity sponsors and strategic buyers the possible acquisition of the Company. The Reporting Persons have engaged Bear, Stearns & Co. Inc. ("Bear Stearns") to act as the Reporting Persons' financial advisor in connection with these efforts. The engagement of Bear Stearns and the Reporting Persons' efforts to evaluate a possible acquisition of the Company may also result in the Reporting Persons' support of a third party's proposal to acquire the Company. The Reporting Persons also intend to contact and discuss with other shareholders of the Company their respective views regarding their investment in the Company, the Company's prospects and possible strategies to maximize shareholder value. Such strategies could include, among other possibilities, a proxy solicitation to seek shareholder approval of proposals the Reporting Persons may make and/or elect directors to the Company's board of directors. Although the Reporting Persons are actively exploring their options with respect to the Company, there can be no assurance that the Reporting Persons will seek to implement any one or more of the foregoing."

Sandell Asset To Sybase (SY): Sandell Wants A Buyback, Spin-Off Or Sale

In a 13D filing Friday on Sybase, Inc. (NYSE: SY), Sandell Asset Management disclosed a 6% stake in the company and urged the company to pursue various options to improve shareholder value including (i) aggressive use of balance sheet to repurchase shares, (ii) IPO and spin-off 100% of mobility segment and (iii) sale of the Issuer in whole or in part.

In a presentation to Sybase, disclosed in the filing, Sandell commented on the three recommended options:

(i) For the share buyback, Sandell said assuming Sybase repurchases $500mm of shares each year for 3 years, the company could create value of $33/share.

(ii) For the IPO and Spin-Off of the mobility segment, Sandell said EMC’s (NYSE: EMC) IPO of VMWare (NYSE: VMW) demonstrates the ability to generate shareholder value by highlighting hidden growth within a more mature entity. The firm said their analysis indicates that their proposed series of transactions will conservatively create total shareholder value of at least $31-$33/share for Sybase.

(iii) On a sale of the company, Sandell said, based on multiples of prior transaction, Sybase could be worth up to $41.39 per share in a deal. Sandell also said, should the credit markets recover, Sybase is likely an attractive LBO candidate.

Shares of Sybase are up 4% in mid-day trading following the 13D filing.

Could Icahn Target Biogen Idec (BIIB) Next?

Following news that Carl Icahn activist target BEA Systems Inc. (Nasdaq: BEAS) received a $17 per share takeover bid from Oracle (Nasdaq: ORCL), investors are looking at Biogen Idec (Nasdaq: BIIB) as Icahn's next possible activist target.

In the latest 13F from Carl Icahn's Icahn Management hedge fund the firm showed a 2,740,000 share stake in the biotech company. This is equal to about 1%.

In August, Icahn received FTC clearance to increase his stake in Biogen, but has yet to disclose an increased stake.

Icahn bought Biogen's stock because he believes the company is undervalued and is a takeover candidate.

Icahn has had success with biotech companies in the past - he was accumulating shares on MedImmune shortly before the company announced a sale to AstraZeneca PLC (NYSE: AZN).

Shares of Biogen Idec are up 1% today to $67.82.

Large Crown Crafts (CRWS) Holder Wants The Company To Pursue Strategic Options

In an amended 13D filing on Crown Crafts Inc. (Nasdaq: CRWS), 14.6% holder Wynnefield Partners disclosed a letter delivered to the board of directors requesting that the company form an independent Strategic Alternatives Committee and hire an advisor to undertake an analysis of all the strategic options available to the company, including a sale or merger.

From the Letter, "Wynnefield has been a strong advocate of establishing a Strategic Alternatives Committee (SAC) and we feel this notion was endorsed by your shareholders in the August election. Crown Crafts Inc. ("the Company") should take prompt action to form a truly independent SAC and, consistent with this notion, employ a competent outside "arm's length" firm to undertake an analysis of all the options available to the Company. This analysis must include a sale or merger of the Company to be undertaken in the event that adequate risk adjusted returns on invested capital for new initiatives can not be identified. No significant acquisition should be undertaken until this process is completed."

A Copy of the Letter:

Dear Randall:

Now that the dust has settled, I am writing you to outline Wynnefield's view of how the Board should proceed and our expectations with respect to governance and the creation and release of shareholder value.

Wynnefield has been a strong advocate of establishing a Strategic Alternatives Committee (SAC) and we feel this notion was endorsed by your shareholders in the August election. Crown Crafts Inc. ("the Company") should take prompt action to form a truly independent SAC and, consistent with this notion, employ a competent outside "arm's length" firm to undertake an analysis of all the options available to the Company. This analysis must include a sale or merger of the Company to be undertaken in the event that adequate risk adjusted returns on invested capital for new initiatives can not be identified. No significant acquisition should be undertaken until this process is completed.

We are also concerned about the governance of CRWS and, as Wynnefield articulated in the proxy materials, request that you promptly unstagger the Board, articulate and implement a succession plan for yourself and other senior executives and orient Board compensation away from cash and toward equity participation in the form of a combination of option grants at market and restricted stock.

It is unfortunate that we had to undertake our successful but expensive proxy campaign to have a Wynnefield nominated voting director in light of the many years of cooperation between us. This should have been something that you were more than happy to do as a matter of course. However, that is in the past and we are prepared to move ahead to meet the many opportunities and challenges that the Company is facing with respect to its products, customer base and strategic future.

The things that need to be done should be undertaken in a manner that indicates absolute sincerity and reality of purpose; we are beyond the "window dressing" phase. I was not elected to the Board and Mr. Rick Wasserman is an independent director. Since we are not insiders, we believe it is in the best interests of all shareholders that there be a public response to this letter. As always, Wynnefield, as your largest shareholder, stands by to offer advice, assistance, access to our wide range of contacts and anything else we can reasonably do to assist in increasing value for the outside shareholder.

Nelson Obus
General Partner, Managing Member

Olstein Capital Discloses 9.5% stake in Denny's (DENN), Plans To Communicate With Company

In an amended 13D filing on Denny's Corporation (Nasdaq: DENN), Olstein Capital Management disclosed a 9.5% stake (8,887,100 shares) in the company.

Olstein said they believes that the stock is undervalued and that steps can and should be taken by the company to increase the market valuation of the stock. Olstein plans to communicate with the company on alternatives for realizing the unrecognized value and suggestions for improving the company's financial strength. Olstein intends to continue its dialogue with, and to take an active interest in, the company regarding, among other things, the company's strategic direction.

Ackman's Pershing Square Changes Filing Status on Borders Group (BGP) to 13D, Stake Unchanged

In a 13D filing on Borders Group, Inc. (NYSE: BGP), William Ackman's Pershing Square Capital disclosed an 11.7% stake (6,855,580 shares) in the company and said the company contacted them about certain corporate governance and other matters including the composition of the Board of Directors.

The 11.7% stake disclosed in today's' filing is identical to the shares held by the firm at quarter ended June 30, 2007. Pershing Square previously filed its position in a 13G filing, which would indicate a "passive investment."

Pershing Square said the change in filing status from 13G to 13D was not related to activities that have the purpose or effect of changing or influencing control of the company.

From the Filing:

"Representatives of the Issuer recently solicited Pershing Square's views regarding certain corporate governance and other matters including the composition of the Issuer's Board of Directors. The Reporting Persons filed this Schedule 13D to permit free communication between the Issuer and Pershing Square on this and other topics.

Prior to the date hereof, the Reporting Persons had on file with the Securities and Exchange Commission a Schedule 13G with respect to their beneficial ownership of Common Stock. Although the Reporting Persons do not believe that Pershing Square's providing its views or engaging in communications as described above would constitute activities that have the purpose or effect of changing or influencing control of the Issuer, the Reporting Persons are filing this Schedule 13D in order to remove any possible impediment to providing such views or engaging in such communications."

Icahn Raises Stake in BEA Systems (BEAS) to 13.2%

In an amended 13D filing on BEA Systems, Inc. (Nasdaq: BEAS), Carl Icahn disclosed an 13.2% stake (51,820,017 - includes Shares underlying call options) in the company. This is up from the 11% stake disclosed in a 10/03/07 filing.

Icahn did not update the 'Purpose of Transaction' section of the filing, which in the original filing, stated that Mr. Icahn believes that a sale of the company to a strategic acquirer will maximize the price of the shares. Icahn also said he was seeking talks with management to discuss possibilities of a deal and said he may seek to nominate members for election to the Board of Directors.

Cohen's SAC Capital Raises Stake in i2 TECHNOLOGIES (ITWO), Suggests a Sale

In a 13D filing on i2 TECHNOLOGIES, INC. (Nasdaq: ITWO), Steven Cohen's SAC Capital disclosed an 8.9% stake (1,905,806 shares) in the company. This is up from the 5.2% stake (1,106,038 shares) the firm held at the quarter ended June 30, 2007. SAC said they believe that the assets, including intellectual property, tax attributes and ongoing operations, are undervalued and are not appropriately reflected in the price of the Common Stock. The firm believes that the best way for the company to increase shareholder value would be a public sale.

Ackman Takes Stake in Another Large US Retalier, This Time It's Sears (SHLD)

At a charity event in Dallas yesterday William Ackman, the owner of activist hedge fund Pershing Square Capital, told the audience that he owns a 5 million share stake in Sears Holdings Corporation (Nasdaq: SHLD). Ackman also indicated that he was thrilled with the efforts of Sears' Chairman Eddie Lampert and was looking forward to working with him.

A 5 million share stake in Sears would give Ackman's firm 3.5% of the outstanding stock.

Ackman's firm recently accumulated a large stake in another large US retailer, Target (NYSE: TGT). Following Ackman's involvement, Target said they would review alternatives for their credit card receivables.

Last year, Ackman won a battle against Lampert's Sears Holdings when the Ontario Securities Commission killed the company's $899 million takeover of Sears Canada. Ackman argued that Sears Canada was worth at least twice what Lampert offered.

Indications from Ackman's comments is that he will not take a combative activist bent with the Sears investment and will look at it as more of a partnership.

PDL BioPharma (PDLI) Yields To Activists Pressure

Activist-target PDL BioPharma, Inc. (NASDAQ: PDLI) is trading 7.5% higher today following news, after the close, that the company will seek offers for the sale of the company as a whole or of its key assets. The company also announced that Mark McDade has stepped down from his position as chief executive officer and a director effective immediately.

PLDI has been an activist target of Dan Loeb's Third Point LLC and Highland Capital Management. In addition, Stevie Cohen's SAC Capital owns a 'passive investment' in PDLI.

Both activist groups have been calling for McDade's head and a sale of the company as a whole. The one thing the firms didn't get was the head of Chairman L. Patrick Gage, who will now also take over as interim CEO.

Wachovia's analyst sees the stock worth up to $25 per share in a deal. Some have estimated the stock could be worth north of $30. The stock is currently at $23.

Large Duckwall-ALCO (DUCK) Holder Strongbow Capital Proposes Changes

In an amended 13D filing on Duckwall-ALCO Stores Inc. (Nasdaq: DUCK) 14.2% holder Strongbow Capital proposed certain changes in a recent telephone conversation with Warren H. Gfeller, the Company's Chairman.

The proposed changes:


1. Expand the size of the Board by one member and appoint Royce Winsten to fill the newly created Board position.

2. Create an executive committee of the board, which would be authorized to exercise all the powers and authority of the Board in the management of the business and affairs of the Company. The firm said the executive committee would be charged with: reducing average inventory levels, reducing SG&A expense, reducing losses from shrinkage.

The firm also recommended that Lolan C. Mackey be appointed chairman of the executive committee and that Mr. Winsten be one of the members of the committee.

Furniture Brands (FBN) Surges After Large Holder Samson Holding Discloses Approach

Shares of Furniture Brands International Inc. (NYSE: FBN) are 29% higher after 14.9% holder Samson Holding Ltd. disclosed that they presented a proposal to the company in July this year with respect to a possible business combination transaction, which the company declined to pursue.

The firm noted that Furniture Brands is a major customer of Samson Holding and in a business that is complementary.

Samson Holding is the largest Hong Kong-based furniture maker.

From the Filing:

"The Shares acquired by the Reporting Persons were viewed by the Reporting Persons as an attractive strategic investment in the Issuer. Samson Holding presented a proposal to the Issuer in July this year with respect to a possible business combination transaction, which the Issuer declined to pursue. The Issuer is a major customer of Samson Holding and in a business that is complementary to the Reporting Persons’ businesses and/or investments. The Reporting Persons intend to review their holdings in the Issuer on a continuing basis and, depending on the price and availability of the Issuer’s securities, subsequent developments affecting the Issuer, the business prospects of the Issuer, general stock market and economic conditions, tax considerations and other factors deemed relevant, may consider various alternative courses of action and take any action deemed appropriate, including, but not limited to, the acquisition or disposition of the Issuer’s securities through open market transactions, seeking to acquire control of the Issuer through privately negotiated transactions, tender offers, exchange offers, mergers or otherwise, seeking board representation, or making proposals to the Issuer or its shareholders. The Reporting Persons may attempt to enter into discussions with the Issuer’s management, directors or other shareholders with respect to any of the foregoing. As part of their ongoing review, the Reporting Persons have engaged and/or may in the future engage, legal and financial advisors to assist them in such review and in evaluating strategic alternatives that are or may become available with respect to their holdings in the Issuer. Except as set forth in this Statement, none of the Reporting Persons has any present plans or proposals that relate to or would result in any of the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D."