The Activist Spotlight

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>>The Activist Spotlight

Immersion Corp . (ticker: IMMR)

What's Happening: Ramius Capital filed a boilerplate 13D stating no current activist intentions.
Key Numbers and Dates:
4: the number of recent 13D filings by Ramius on companies with a solid core business and an underperforming non-core business.
10.7%: Ramius' average return on those four investments.
13.9%: the average decline in the S&P 500 in the same periods.
Behind the Scenes: Despite filing a boilerplate 13D, Ramius certainly will meet with management and will take an active role in enhancing shareholder value.

In its 13D filing on Federal Signal, Ramius used the same boilerplate language but, three months later, received a board seat. In the past, Ramius has had great activist successes in companies that have solid core businesses with significant cash flow, but where management has been reinvesting the cash flow in non-core and unsuccessful businesses. In its Datascope 13D filing, Ramius got one director elected and supported the company's decision to sell its Patient Monitoring business; this investment generated a 28.9% return during an eight-month stretch in which the S&P fell 24.4%.

Immersion's Touch unit, which offers touch-feedback technology to enhance realism in computer and other applications, has a highly profitable licensing stream with high gross margins. Its medical business, which offers simulation technology for training, is more capital-intensive. Ramius will study the two units and likely will strongly urge the company to focus its resources on the Touch business and explore strategic alternatives for the other.