All bark and no bite is how Wall Street Journal shareholder activism reporter Lauren Thomas views the 2023 proxy season so far. This runs contrary to what many experts believed would be a proxy season for the ages with battles aplenty following the adoption of the universal proxy. Activists have largely holstered their weapons – see Peltz v. Disney and Third Point v. Bath & Body Works – opting to settle instead of knuckling up at annual meetings. Jim Rossman, global head of shareholder advisory at Barclays, cites the high costs of proxy fights as a contributing factor to more settlements. Speaking to the Journal, Andrew Freedman, a lawyer to activists, attributed more settlements to the universal proxy, saying, “companies that may have felt comfortable going into contests and taking them the distance in 2020, 2021 are a lot more wary of testing the waters today.” Whatever the reason, we will be watching to see if the trend of more agreeable activists continues.

Meanwhile, in one of the few fights taking it to the end, Francis deSouza, Illumina’s CEO, joined Squawk Box Wednesday morning following first quarter earnings that beat Wall Street estimates, as the company faces octogenarian loudmouth Carl Icahn ahead of its Annual Meeting on May 25, 2023. 

In the Bay Area, activism and regulatory activity were prominent discussion topics at the Berkeley Center for Law and Business’ Spring Forum on M&A and the Boardroom this week. The SEC’s Ted Yu remarked that he doesn’t agree with the description of universal proxy as “proxy access on steroids,” but that the SEC is still waiting to see how the new rules play out this season. He advised companies to remain skeptical of any doomsday scenarios in which the enactment of universal proxy would trigger a wave of contests. FTC chair Lina Khan also spoke at the conference, albeit virtually, as Semafor’s Bradley Saacks reported that her comments “struct a combative tone,” and reinforced her tough stance on worker protections, megamergers and restricting illegal competition activity. It's certainly not the last we’ll see of Khan, as she’s just shared plans to stay at the FTC for another year.  

Have a great weekend,

GPP Team

Wall Street Journal: What’s News: Activist Investors Lay Down Their Arms

Lauren Thomas joins the "What's News" podcast to discuss why activists are "showing more bark than bite" and starting to take a more conservative approach to engaging company boards. Listen Here 

CNBC: Illumina CEO Touts Grail’s 100% Revenue Growth Amid Proxy Fight with Icahn

Illumina CEO Francis deSouza joined CNBC's "Squawk Box" to highlight the company's quarterly results amidst an ongoing proxy fight against Carl Icahn. Watch Here 

Bloomberg: Antitrust Agitator Khan Refutes Critics, Plans to Stay at FTC

FTC Chair Lina Khan has signaled her intent to stay put in her position at the FTC, despite the pushback from Republicans and critics who say she is “anti-business.” Read More

Fortune: CFO Daily: Red Flags for Activist Investors

Sheryl Estrada discusses findings from a new Goldman Sachs report claiming there are four primary characteristics that make companies susceptible to attack by activist investors: “slower trailing sales growth, lower trailing EV/sales multiple, weaker trailing net margins and trailing two-year underperformance.” Read More 

Harvard Law School Forum on Corporate Governance: Anticipating Activist Attacks

Wachtell, Lipton, Rosen & Katz lawyers David Katz, Sebastian Niles and Carmen Lu discuss the increased likelihood that companies will be "swarmed" by "activist wolfpacks" and share their list of activist preparedness tips. Read More 

Fierce Pharma: As Bayer's CEO Switch Nears, Activist Investor Pushes Harder for Breakup, Board Changes

The activist firm Bluebell Capital Partners is increasingly pressuring Bayer for "bold" changes, including a potential breakup of the company's pharmaceutical and consumer health divisions, writes Fraiser Kansteiner. Read More

M&A

Latham & Watkins: The Unions Strike Back — Considerations for M&A Acquirers

The law firm discusses how important it is for acquirers to recognize unions and other employee organizations at target companies, especially given the increased role and influence such groups are able to play within an organization. Read More  

Fortune - Term Sheet: M&A for Venture-Backed Startups Has Fallen to the Lowest Quarterly Level in a Decade

Yet another metric that illustrates the stagnation of the deal market, M&A levels amongst venture-backed companies are lagging at their slowest pace in nearly ten years, writes Lucy Brewster. Read More 

Harvard Law School Forum on Corporate Governance: The Board’s Oversight of Employee Voice

State Street’s Benjamin Colton and Holly Fetter share research on how boards can more effectively manage their employees by tactics like encouraging human capital investment, holding management accountable for progress, integrating "people" and "business" metrics and more. Read More 

Cooley: What We Need to Know About Corporate Governance—But Don’t

A new paper by Stanford University's David Larcker and Brian Tayan suggests that there are significant "holes" and "assumptions" in existing corporate governance theories and that more research is required to answer big questions such as, “what makes boards effective?” and "what is the value of a CEO?" Read More 

FROM OUR DESK TO YOURS

For the oenophiles at GPP we have been fascinated by “Drops of God,” the new series on Apple TV about a wine-tasting contest that pits the estranged daughter of a famous French wine critic whose palate was trained since she was a child with the critic’s Japanese protégé.  

Based in Paris, the French countryside and Japan, the tale centers around the renowned critic’s last will and testament, which says his daughter and protégé must battle to win the greatest collection of wines in the world, valued at $148 million. Three glasses, three months, pick the producer and vintage, the winner takes all. We’ve only watched the first two seasons which have our mouths watering for a glass of Rhone or Burgundy. There’s a cameo from one of our favorite Bordeaux producers east of St. Emilion on the Le Couteau des Merveilles plateau, Chateau Le Puy, which has been in the same family since 1610. We have had the pleasure of visiting Le Puy and highly recommend. See here to get the San Francisco Chronicle’s review of the show which shares the view that this show is indeed a standout. 

GPP will be at the Milken Conference next week and look forward to catching up with friends and clients.

Go GPPers! And as promised, below is photo evidence that GPP’s Layton Lassiter and Chris Perry at the Jersey City Marathon. The words of encouragement were greatly appreciated, and we are very proud!   

PEOPLE MOVES

Moves this week include:

• Bristol Myers Squibb CEO Giovanni Caforio will retire in November after serving in the role since 2015. He will be replaced by Christopher Boerner, the company's current Chief Commercialization Officer. Read More

• Cassie Thorton has been named new head of IP at Bloomberg Media and will be tasked with expanding its journalism business. Read More



• Meg Tirell will join CNN’s Health and Medical Unit after leaving CNBC. Read More

• Katrina Robson has joined Willkie Farr & Gallagher LLP as a partner in the firm's antitrust and competition practice. Read More

• April 30-May 3, 2023: Milken Institute Global Conference 2023 – Beverly Hills, CA

• May 10, 2023: Axios BFD 2023 – San Francisco, CA

• June 6, 2023: The Deal Economy 2023: Predictions and Perspectives – New York, NY

• June 6-8, 2023: NIRI Annual Conference – Chicago, IL