Hedge fund Elliott Management Corp. bought a $2.5 billion stake in semiconductor company Texas Instruments, CNBC reported on Tuesday citing a letter sent by Elliott. In it, the activist investor urges the chip company to adopt a "dynamic capacity-management strategy," arguing it could increase its cash flow 40% to $9 a share by 2026.
Elliott claimed Texas Instruments' decision to shrink its free cash flow in 2022 "alienated investors who might otherwise gravitate to its dominant position in serving the automotive and industrial complexes with analog chips."
Texas Instruments gained 1.67% at the market open following the news.
