Bloomberg’s first-half wrap of activism data highlights a predicted uptick in campaigns year-over-year but touches on a more interesting point two-thirds of the way through the piece. A partner at Olshan Frome Wolosky, the New York law firm that advises activists on the lion’s share of campaigns every year, is quoted as saying one of the factors that fueled a contentious round of fights this proxy season was a distinct disconnect: on the company side, the belief that they weathered the pandemic well and have clear skies ahead; on the activist side, the belief that whatever flaws existed pre-pandemic still exist.
The ongoing debate about the 13D window is back on the front burner as the SEC has vowed to take a look at it…again. Companies argue that the 10 days an investor is allowed to report an active, 5 percent or more stake gives a hedge fund an unfair advantage to build its position. In the UK, the window is zero days, as Corporate America and their advisers often point out. The company argument that 10 days is excessive is a fair case to make, but hedge funds are increasingly using derivatives to build positions in targets that can keep a 5 percent plus stake a secret for a lot longer than 10 days.
Finally, BlackBerry’s Lead Independent Director won reelection at the company’s AGM this week, proving that a withhold recommendation from Glass Lewis and an influential analyst may make a majority vote harder to achieve but not impossible.
Have a great weekend,
Mike
