(Reuters) – Healthcare-focused Glenview Capital Management has established a large position in CVS Health (NYSE:) and will meet top executives at the struggling healthcare company on Monday to propose ways it can improve its operations, The Wall Street Journal reported on Sunday.
The hedge fund’s founder Larry Robbins plans for the potential start of an activist stance as CVS amounts to about $700 million of his $2.5 billion hedge fund, the report added citing a person familiar with the matter.
Glenview’s position is a sign of Robbins’s belief in the company’s potential and his confidence he can get executives to pursue a new path, as per WSJ.
CVS and Glenview did not immediately respond to a Reuters’ request for comment.
Speculation has mounted among fund managers that an activist investor may swoop in to push CVS to make changes that would boost its share price.
Investment firm Sachem Head Capital Management built a new 0.2% stake in the company during the second quarter, according to a regulatory filing in August.
Earlier in August, CVS took down its annual profit forecast to $6.40 to $6.65 per share from its prior view of at least $7.00, marking at least the fourth time the healthcare conglomerate lowered its outlook for the year.
It also announced a multi-year plan to save $2 billion in costs through measures such as streamlining its operations and using artificial intelligence and automation across its business.
