The Wall Street Journal: Activist investor Marcato urges Goodyear to return $4.5 billion to investors

Activist investor Marcato Capital Management LP is pushing Goodyear Tire & Rubber Co. to return $4.5 billion to investors over the next three years in a bid to boost the tire giant’s flagging stock price.

In a letter to the Goodyear’s GT, +0.32% board Tuesday, the activist hedge fund says it is “impressed” by Goodyear’s management and recent performance, but lamented its languishing stock. The company’s shares are down 15% this year, even as rising truck and SUV sales and falling gas prices lifts demand for its tires.

“We believe if the company targets this magnitude of capital return, it would create significant shareholder value, and we would not be surprised to see the share price increase by as much as 50%-100% as a result,” Marcato’s Richard “Mick” McGuire wrote in the letter, which was reviewed by The Wall Street Journal.

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