coke to lose its fizz??

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    Activist aims to sink Coke shares

    Thu Nov 25, 2:39 PM ET

    By Tim Castle

    LONDON (Reuters) - A former Wall Street stockbroker plans to launch a hedge fund to short-sell shares in Coca-Cola Co. and give any profits to people in countries he says the U.S. drinks company has exploited.

    Max Keiser, 44, a self-styled "investment activist", has teamed up with the son of the late entrepreneur Sir James Goldsmith with the aim of halving Coke's share price to $22 (11.66 pounds) in 12 months from its current value of around $40.

    Profits from the fund would be distributed to the "victims of Coke" in a process supported and audited by Zak Goldsmith's London-based Ecologist magazine, which will decide where to donate any proceeds.

    Keiser says Coca-Cola has poisoned land in India and trampled on human rights in Colombia, charges the company has frequently and vigorously denied.

    "Coke's been down this year as sales dry up," Keiser told Reuters, attributing part of the fall in the stock to anti-American sentiment following the U.S.-led invasion of Iraq

    Earlier this month, Atlanta-based Coca-Cola, the world's largest soft drinks company, lowered its long-term earnings and sales targets, saying it expected demand for its products to remain weak in North America, Germany and other key markets.

    Keiser hopes a campaign to boycott Coca-Cola products will undermine the company's share price, making money for his as yet unnamed hedge fund, which will sell Coke shares with the aim of buying them back more cheaply later.

    "Our target for Coke is $22 as dissent is pushed back onto the balance sheet," said Keiser, a New Yorker living in London who runs investment activism website

    Coca-Cola stock touched a year low of $38.30 in October, well down from highs of over $85 they reached in the late 1990s. They closed at $39.80 on Wednesday, before the Thanksgiving holiday, valuing the company at more than $96 billion.


    "This so-called campaign is based on blatant falsehoods," Coca-Cola spokesman Ben Deutsch told Reuters by phone from Atlanta.

    "It's unfortunate that anyone would attempt to hurt Coca-Cola shareholders by waging such an effort without knowing and recognising the facts," Deutsch added.

    Keiser worked with Wall Street stockbrokers PaineWebber and Alex Brown in the 1980s before co-founding the Hollywood Stock Exchange website, a virtual exchange trading celebrity values which is now owned by broker Cantor Fitzgerald.

    He plans to register his hedge fund by early next year, probably in Britain, and to tap a number of rich private investors to raise up to $100 million.

    Iain Martin, editor of specialist London monthly Hedge Fund Manager, said Keiser's investment strategy had several merits and that his funding target was attainable.

    "Hedge funds are attracting a lot of interest from high net worth individuals and institutions," Martin said. "I think there's no reason to think he won't achieve that total."
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