MI Developments owns and develops industrial real estate properties in North America and is controlled through a block of super-voting shares by Frank Stronach, its 76-year-old chairman, who is the founder of the auto parts giant Magna International.
Einhorn was engaged in a multi-year battle with MI Developments and was highly critical of Mr. Stronach for using MI’s cash to give loans and enter into transactions with other companies he controls, including Magna Entertainment which manages horse racing tracks and casinos mainly in North America.
MID’s board of directors has a fiduciary duty to protect the shareholders of MID, not to focus as Mr. Stronach says on what’s a "fair thing for MEC," Einhorn wrote.
“The facts are obvious and beyond dispute: MEC has utterly failed as a business enterprise,” he wrote. “More money, time, and resources will not resuscitate it under Mr. Stronach’s leadership or anyone else he appoints to pursue his so-called vision.”
At one point Einhorn owned more than 11% of the company along with other prominent hedge fund managers. He liquidated most of his position in the second quarter of this year around $28 a share.
However, Stronach has recently left the company and they converted it to a REIT. Many investors expect MI to rise as it now sports a $2 dividend. The stock now trades at $32 meaning that Einhorn left a lot of money on the table.