Actionable Ideas for Companies and Sponsors
Traditional Institutional Investors Now Embracing Activism
Activist investors have substantially increased their proactive engagement with YTD 2018 activity of approximately 400 campaigns, matching the annual totals for 2013 and 2014 and on pace to exceed 2017’s record level. However, growth in activism is not coming solely from the 112 activist funds. In fact, of the 662 public campaigns in 2017, only 24% came from full-time activists.
The real drivers of activism have been traditional investment managers, such as AllianceBernstein and Blackrock, who are now embracing activism as a key responsibility of investment management. These investors are driving shareholder returns by agitating for more thoughtful M&A strategies, divestment of non-core businesses and changes in board composition. Investment managers are leveraging their in-depth investment research and their ongoing engagement with managements and boards – without the aggressive approach employed by the full-time activists – to become mainstream change agents.