New 13D Head at SEC

After five months without an official director, the Securities and Exchange Commission reportedly has a new head of mergers and acquisitions, Michele Anderson. And she's going to have her hands full.

The agency hasn't officially announced it yet, but Anderson was promoted to become the Corporate Finance division's new chief of the Office of M&A. Anderson replaces Brian Breheny, who in November moved up to become deputy director for Legal and Regulatory Policy at the agency.

High on Anderson's agenda will be figuring out what do about the agency's Schedule 13D rules when it comes to "cash-settled swap agreements" and other synthetic securities deals that activist hedge fund managers enter into with derivatives dealers. Do such swaps give activist hedge funds more control over a company's fate than they would like to let on? That's a question Anderson will try to figure out.

Recently, a railroad operator, CSX Corp., sued activist investor Children's Investment Fund Management LLP, charging that it violated federal securities laws by holding back information on how many shares it owned. Whether activist fund managers are forming illegal groups with derivatives dealers or just indirectly influencing the amount of shares being dumped on the market, Anderson's job will be a busy one.

In addition to 13Ds disclosure, Anderson will also be busy with cross-boarder business combination exemptions.

But Anderson comes prepared. Even though she worked recently as a legal branch chief in the Office of Telecommunications, she worked in the M&A office a few years earlier. - Ron Orol