Steel Partners II LP is one of the most well-known activist hedge funds in the market today ran by 40-year-old Warren G. Lichtenstein, founder and principal of the billion dollar hedge fund. Through the years, the fund has built a track record of success through hostile takeovers and proxy battles. Like most activist funds, Steel Partners is simply attempting to give shareholders the money and rights that they deserve by replacing inefficient management and streamlining processes/spending.

In rare talk with Business Week last year, Mr. Lichtenstein offered some insight into his funds purpose and goals. He first noted that he thinks of Steel Partners more as a partnership that hedges itself by "buying cheap" than a stereotypical hedge fund. That is, instead of dealing in trading securities, he prefers to deal in terms of the companies they represent. Steel Partners has typically focused on finding undervalued companies (typically due to bad management) and unlocking that value. This usually involves replacing the Board, firing the responsible persons, and then unlocking the company's potential. Mr. Lichtenstein also told Business Week that he offered something management couldn't: Discipline. He said that his fund is focused on empowering people and held them accountable for their actions - something that corporate management these days struggles with. Finally, he revealed that his future plans are to focus his energy on larger companies with billion dollar market caps, because he finds them less risky despite being "riddled with inefficiencies and excessive costs".

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We first featured IMAX Corporation (NDAQ:IMAX) here back on August 11th when the stock was halved after a string of bad news. Since then, the stock had dropped another dollar or so before settling down in the upper $4 range. However, interest was renewed in today's trading as CNBC's Thomas Ko revealed that he added the stock to his portfolio, citing a potential buyout. Ko made the argument that the stock was at $10 when they were unable to find a buyer in the Board's range (most likely around $15), now it is much more attractive. Currently, the stock is trading in the $5 range - a 50%+ discount from its high a month earlier. Ko believes that many companies, potentially including Walt Disney Co. (NYSE:DIS) and Sony Corp. (NYSE:SNE), might be interested in the company in the $7 area. At this point, a buyout between $7 and $9 would be difficult for the Board to turn down, given the recent SEC investigations and other issues plaguing the company. Moreover, if the Board expressed interest in a sale before this entire ordeal happened, it is perhaps more likely that they would consider any opportunities in their situation now.

This speculation caused the stock price to surge 10% to settle at $5.27 on the day. It is likely that day traders will now be involved in the stock, and may cause significant near-term volatility. Also remember, a buyout is still nothing more than a rumor. However, the company remains cheap at its current levels and we know the Board was (and perhaps still is) interested in a sale of the company. These factors justify at least keeping an eye on the company throughout the next few months as things get clearer.

Related Companies
Sony Corp. (SNE)
Walt Disney Co. (DIS)

Weatherford International Ltd. (NYSE:WFT) revealed today in a Form 4 filing with the SEC that director Robert Moses purchased 53,544 shares on Monday at prices ranging from $39.88 - $39.99. This $2 million purchase follows a rush of other smaller puchases by company officers and directors on September 1st. Weatherford provides equipment and services used for the drilling, completion, and production of oil and natural gas wells in the U.S. Some are speculating that this move relates to the company's earlier announcement of a successful installation of their "Life of Well" system. In that announcement, the company gave an overview of the system:

"Weatherford's Life of Well(TM) optical in-well system is providing both continuous seismic and pressure/temperature monitoring data and is also interfaced to the existing permanent ocean bottom cable system. This allows for the simultaneous collection of permanent seabed and downhole seismic data representing a significant milestone for the industry."

Although a report issued yesterday argued that value investors should wait to invest in oil services companies, investors applauded the insider buying as the price rose 5.45% in mid-day trading today.

Related Companies
Precision Drilling Trust USA (PDS)
Smith International (SII)
Halliburton Company (HAL)