Brinks Co. (NYSE:BCO) may find itself in hot water soon as Pirate Capital suddenly took a more active role in its investment. In a 13D/A filing with the SEC today, the 8.5% holder demanded that the company (i) take immediate steps to unlock long-term shareholder value by retaining an investment bank to explore the sale of the company and initiate a large Dutch tender offer for the shares, and (ii) immediately appoint Thomas R. Hudson Jr. to the board. This move comes after Brinks failed to listen to Pirate's past requests to retain an investment bank and instead announced plans for its own acquisitions.

According to a letter attached to the filing:

"The purpose of this demand is to enable the Fund and its affiliates to communicate with the Company's shareholders on matters relating to their interests as shareholders or beneficial owners with respect to a shareholder proposal set forth in the Fund's notice to the Company of even date herewith and, possibly, to facilitate and support a proxy solicitation of the Company's shareholders to elect one or more members of the board of directors of the Company, including the undersigned, which the Fund is contemplating but has not decided upon." (Read More)

Nobody wants a proxy battle, as they are a long and expensive process (and Pirate has a lot of experience!). Therefore, it is likely the company will take this as a hint and start a dialog between the two parties. In the end, it is likely that hedge fund will receive a spot on the Board and head a committee to explore strategic alternatives. If the company is indeed undervalued and this idea has merit, then this proposal will be put to a shareholder vote at an annual meeting. Although this is all a very long process, it definitely makes BCO a stock worth watching, since any buyout comes at a premium to market prices.

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