Shareholder Activism

GE can get ahead of chairman-CEO trend

25 April 2018

The conglomerate defeated a shareholder proposal to separate the top jobs. But 41 pct of investors supported the measure, up from 24 pct a year ago. Double-titled boss John Flannery could pre-empt an embarrassing rebuke next year, and improve governance, by embracing a split now.

Takeda’s stretch for Shire lets rivals limber up

25 April 2018

The Japanese drugmaker's fifth proposal for its Irish rival sweetens the bid to some $64 bln. The headline value, which uses a huge pile of stock for currency, is falling fast as Takeda shareholders recoil. That creates an opening for other suitors who can offer more hard cash.

Whitbread’s coffee spinoff is too slow

25 April 2018

The UK company is planning to hive off its Costa cafes less than two weeks after activist Elliott disclosed a 6 percent stake. That may lift the group’s undervalued shares and make the chain a bid target. But a 24-month timeline is too long for investors to wait for the takeaway.

USG bid upsets theory of the free-lunch Buffett

23 April 2018

Building-supplies maker Knauf is getting more hostile in its $5.9 bln bid for USG, whose biggest shareholder Berkshire Hathaway seems ready to sell. More recent buyers may not like the meager premium. Investing alongside Warren Buffett is no guarantee of aping his success.

Breakdown: Telecom Italia’s three-way poker game

23 April 2018

The incumbent telco is entangled in its umpteenth debilitating corporate fight. The row pits U.S. activist investor Paul Singer against French financier Vincent Bolloré. But an Italian state investor may be the key player. Breakingviews explains how the cards will fall.

Icahn offers poaching insurance for VMware

18 April 2018

A stake purchase by the activist investor could add friction in a potential merger of the $53 bln software company with its controlling shareholder Dell. Minority shareholders in VMware ought to expect fair treatment. Icahn's presence might help ensure they get it.

L&G’s gender revolt has revealingly low bar

17 April 2018

The 983 bln pound asset manager will vote against chairs at UK companies if boards have too few women. It’s a laudable move. But the 25 pct threshold looks low, and traps groups as big as Barclays or London Stock Exchange. Diversity in British boardrooms has a long way to go.

Volkswagen overhaul may give Carl Icahn a lift

16 April 2018

New CEO Herbert Diess is mulling an IPO for its truck unit. It’d be a smoother ride if VW boosts its minority holding in U.S. peer Navistar to a controlling stake. Icahn and two other pushy investors own 40 pct of the $3.9 bln outfit - and are likely to want a hefty premium.

Coffee to go offers quick fix for Whitbread

16 April 2018

Activist Elliott controls 6 pct of the UK hotel and coffee chain and reckons a listing of its Costa brand would add 3 bln pounds of value. It’s a simple-seeming solution to Whitbread’s discount rating. Separating investor worries about the two parts of the business has merit.

Tenneco and Icahn pull a mini DowDuPont

10 April 2018

The U.S. auto-parts maker is paying $5.4 bln including debt for Federal-Mogul, owned by the investor’s listed entity. The plan is to break the merged company into two, boosting the overall value. Shareholders shoulder risk when deals have several steps. But the logic holds up.

Bolloré’s best bet is to play along with Singer

10 April 2018

Vivendi chair Vincent Bolloré may lose a fight for control of Telecom Italia with activist investor Elliott. Selling his 24 pct stake would mean a loss, assuming he can find a buyer. Staying put while Paul Singer’s group tries to revive the Italian telco is a better option.

Dutch lawmakers give Ahold backup in activist spat

10 April 2018

Activist CIAM wants the supermarket to scrap its foundation that can be used to block takeovers. But with the Netherlands eyeing new laws to stymie hostile bidders, companies may not need these arcane tools much longer. Shareholders will suffer either way.

Icahn sets himself tough task at SandRidge

5 April 2018

The investor wants a new board at the $500 mln oil group to ensure it’s sold for top dollar. He may even bid himself. Icahn has proved stubborn at Newell, Herbalife and elsewhere. But with another big shareholder, Fir Tree, thinking differently, SandRidge could test his patience.

Italy’s TIM grab gives investors two messy options

5 April 2018

State investor CDP may buy 5 pct of Telecom Italia. If it sides with Elliott, the activist fund could take control from top shareholder Vivendi. The French group’s oversight of TIM has been dysfunctional. But protectionism coupled with complex ownership is also unappealing.

Smith & Nephew’s new boss has two rehab options

4 April 2018

CEO Namal Nawana has to revive mediocre top-line growth and slash costs at the artificial-knee maker. A flair for turnarounds should keep activist Elliott at bay for now. And the sale of the last company he headed shows an appetite for more drastic prescriptions when necessary.

Travelport must hope Elliott inspires others

26 March 2018

Paul Singer's hedge fund has put the travel-tech company in play by taking a 12 pct stake, and may even make a bid. The risk is Elliott could bully the company into a bad deal, but the potential to boost margins makes it a ripe target. Shareholders should welcome wider interest.

Icahn-Newell pact clarifies Starboard’s value

19 March 2018

The maker of Sharpie pens and Crock-Pot cookers is giving the investor’s firm four board seats, including chairman, and handing it control of divestitures. Icahn’s entry confirms Starboard’s line that Newell needs an overhaul, while showing his fellow activist’s strategic limits.

Activists and their targets grow up together

19 March 2018

Investor militancy is no longer a cottage industry. Activist shareholders increasingly go after big game, with stakes in companies worth 26 pct of the S&P 500's capitalization. They come better prepared – and with allies. Boards, meanwhile, are learning to head off public fights.

Activist’s Barclays punt hinges on investment bank

19 March 2018

Edward Bramson’s Sherborne Investors has amassed a 5.2 pct interest in the UK bank. Some of Barclays’ problems – a CEO under investigation and legal issues – are short-term. A repeat of Bramson’s recent successes will hinge on turning around Barclays’ misfiring investment bank.

Elliott’s Italian master plan needs state player

16 March 2018

The activist fund wants to oust top investor Vivendi from Telecom Italia’s board and sell its network. A stand-alone telco backbone might attract a higher valuation and be able to shoulder more debt. However, success hinges on state-backed investor CDP’s readiness to chip in.