FRANKFURT (Reuters) - New York-based activist hedge fund Hudson Executive Capital LP has taken a stake in Deutsche Bank to become one of the German lender's largest investors.
"Doug Braunstein and Hudson Executive come with deep backgrounds investing in financial services companies," he said in a statement. "We appreciate Hudson Executive's confidence in our ability to execute on our strategic objectives."
Deutsche Bank did not say how large Hudson's stake was. The Wall Street Journal, which first reported the investment, said it stood at 3.1 percent.
The investment is a rare piece of good news for shareholders of Germany's largest lender.
After three years of losses, a failed stress test in the United States, several attempts to restructure, a leadership shake-up and a ratings downgrade, many investors have lost faith in Germany's biggest bank, whose shares have fallen by 44 percent this year.
Deutsche Bank's shares rose after the news and traded 2.3 percent higher midday in Frankfurt to outperform the broader DAX index of bluechips.
The investment makes Hudson Executive one of Deutsche's largest shareholders. Others include the royal family of Qatar, the Chinese conglomerate HNA, Blackrock, and U.S. buyout fund Cerberus.
The fund was not immediately available for comment outside of business hours.
Braunstein told the WSJ in an interview that Deutsche Bank was "misunderstood and undervalued".
The paper said that Hudson's management saw the bank as taking the right steps under Sewing, who assumed the helm of the bank in a sudden management change in April.
"We would not have made the investment but for the fact that we think he's the right guy for the job," it quoted Braunstein as saying.
(Reporting by Tom Sims; Editing by Michelle Martin and Maria Sheahan)
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