Review of Shareholder Activism – Q3 2019

Key observations from Q3 2019 report include: 

 2019 is closing the gap with prior years following an active Q3

• 159 campaigns were launched at 145 companies in 2019 YTD, compared to 185 campaigns at 171 companies in 2018 YTD
• Although 2019 still lags 2018’s record pace, the 51 new campaigns launched in Q3 2019 is a ~19% increase over Q3 2018

European activism ended Q3 with record activity

• Activists launched a record 20 new campaigns in Europe, shifting their historical focus from the U.K. into other jurisdictions, such as France, Germany and Switzerland
• European campaigns notably targeted both underperforming small-cap companies and large-cap outperformers
• Non-U.S. activity continues to account for ~40% of campaign activity, in line with recent years

M&A persists as primary campaign thesis

• 45% of all activist campaigns in 2019 YTD have had an M&A thesis, the highest proportion to date 
• Attempts to scuttle or sweeten transactions were the most common type of M&A-related thesis
• Over half of all capital deployed ($19.1bn) has been in campaigns with an M&A thesis

Activists continue to effect board change

• 98 Board seats have been won by activists YTD and over 800 have been won by activists since the start of 2013
• Nominating long slates remains a popular tactic, with a record 16 nominated in 2019 YTD, but the majority of Board seats are secured outside of the proxy process
• Activists have been successful in five of 21 proxy fights that have gone to a vote in 2019 YTD, resulting in 15 Board seats

2019 Proxy Season Highlights Complex Reality for Companies

• Support for ESG proposals increased as investors further link these issues to corporate strategy and performance
• “Overboarding” was a factor in many narrow Director elections in 2019 due to stricter institutional investor policies
• Investors continued to seek strong ties to strategy and performance in executive pay programs

Download the review to read the findings in full.