As the sun sets on the first proxy season with the universal proxy, Insightia is out with new data about the consequences the new rules are having on activist contests. Axios’ Kimberly Chin and Michael Flaherty noted that the “win” rate of activist investors gaining seats on company boards has increased to 61% this year, compared to 47% in 2022. However, Cristiana Guerra, Head of ISS' Special Situations Research team, told Axios that while the universal proxy likely caused an "uptick in settlements at the beginning of the proxy season," companies are getting increasingly comfortable with engaging activists under the new rules because activists have to defend the individual directors they propose as compared to the company’s slate. Kai Liekefett, co-chair of Sidley Austin’s shareholder activism and corporate defense practice, still expects to see a fair number of “off-season fights.”

Meanwhile, bottles were popping over at the NYSE yesterday, as Cava, the popular fast-casual Mediterranean restaurant brand, priced above its range and closed up 99% on its first day of trading. Will it take the chill off of the IPO market? For now, we’re keeping any predictions on ice.

Meanwhile, if you were just looking at the healthcare industry, there’d be no sign of a global slump in M&A this year. This week, FT reporter Jamie Smyth broke down the $85bn in biopharma acquisitions from January through May – compared to just $35.6bn in the same period of 2022 and $49.1bn in 2021. Big ticket deals this year have been led by acquisitions from Pfizer, Merck and Sanofi. And while there are whispers of regulatory headwinds, Tim Opler, managing director of the global healthcare group at Stifel, told the FT that experts believe that legal grounds for the FTC to win healthcare antitrust battles could be weak.

It’s a different story over at Microsoft, as the FTC this week officially sued to block its acquisition of Activision Blizzard. And the proposed merger of PGA Tour and LIV took a left turn when Connecticut Senator Richard Blumenthal opened an investigation into the deal, backing the notion put forth by anti-monopoly commentator Matt Stoller that, “this deal, in its current form, doesn’t make any sense.”

Have a great weekend,

GPP Team

Axios: Activist Investors See Success Rate Jump After New SEC Rule

Kimberly Chin and Michael Flaherty highlight data from Insightia revealing that the advent of universal proxy rules has led to both a spike in activists winning board seats and also an increase in settlements with companies. Read More

CNBC: Mediterranean Restaurant Chain Cava Stock Soars as Much as 117% in Market Debut

As the first highly anticipated initial offering in months, Cava priced at $22, above its $19 to $20 range, before opening at $42 per share. Read More

Financial Times: Big Pharma Dealmaking Recovers with $85bn M&A Splurge

Dealmaking activity by major players in the pharmaceutical and biotech industries has increased significantly compared to last year, writes Jamie Smyth, but some bankers and analysts are wondering whether the increase in acquisitions may trigger further antitrust scrutiny by the FTC. Read More

ACTIVISM

Heard on the Street: How a Housing Bet Went Wrong for Activist Investor Elliott

Carol Ryan breaks down how Elliott Management's foray into German real estate backfired as the activist firm now looks likely to lose a vote in Deutsche Wohnen SE’s upcoming annual meeting to the German property management company's largest shareholder, Vonovia. Read More

Bloomberg: Salesforce’s Marc Benioff Sees Jump in Investor Support After 61% Rally

After fighting off activist "wolfpacks" earlier this year, Brody Ford details how Salesforce's CEO Marc Benioff is successfully regaining support from investors, although questions still remain around the tech giant’s succession plan. Read More

Wall Street Journal: Toyota Shareholders Re-Elect Akio Toyoda to Board, Rejecting Activist Push

In a win for the company, Toyota shareholders voted to re-elect Chairman Akio Toyoda and rejected a proposal regarding battery-powered vehicles that was being pushed by three European asset managers. Read More

Axios: IPOs Show Signs of Life

Kia Kokalitcheva highlights the gradually rebounding IPO market, which is already on track to surpass last year's total thanks to upcoming listings for Cava, Surf Air and Kenvue, but mentions that some analysts still aren't expect the "real return" of IPOs until next year. Read More

The Wall Street Journal: Nasdaq to Acquire Financial-Software Firm Adenza for $10.5 Billion

Alexander Osipovich reports that Nasdaq announced plans to acquire the financial software maker Adenza for $10.5bn, a deal that if completed would amount to the largest in the company’s history. Read More

The Deal: McCormick Allows Sponsor to Walk from Deal

David Marcus examines Delaware Chancellor Judge Kathaleen McCormick’s decision last week that the PE firm Antin Infrastructure Partners could terminate its merger agreement to buy the fiber broadband provider Optical Tel Inc. after Antin’s legal team proved Optical had misrepresented some of its financial numbers. Read More

F.T.C. Sues to Stop Microsoft’s Activision Deal from Closing 

After facing regulatory hurdles in the UK, the F.T.C. has now sued Microsoft over its proposed acquisition of Activision Blizzard, and the company has previously vowed to fight back, write David McCabe and Kellen Browning. Read More

Reuters: Exclusive: Broadcom Set to Win EU Nod for $61 bln VMware Deal, Sources Say

The European Commission looks ready to give Broadcom antitrust approval for its $61bn planned acquisition of the cloud software developer VMware after making concessions to give rivals access to server operations, reports Foo Yun Chee, but the deal still requires approval in the UK and U.S. Read More

Puck: The Saudi-PGA M&A Legal Hellscape

Eriq Gardner examines the various regulatory, legal and political hurdles that could potentially block progress in finalizing the planned PGA-LIV Golf merger. Read More

ESG

Fortune: Being a ‘Purpose-Driven Leader’ in the Fortune 500 Boosts Revenue

Sheryl Estrada reports on findings from new research by Fortune and Indiggo indicating that "purpose-driven" companies largely report stronger financial results compared to others. Read More

Financial Times: ESG Backlash in the US: What Implications for Corporations and Investors?

Lawmakers motivated by "anti-woke-ism" have recently pushed to block asset managers from incorporating ESG frameworks and purpose-driven investments into their funds, a move supported by some firms such Vanguard, who prefer to take a more laissez-faire stance with their clients, write Diane-Laure Arjaliès & Tima Bansal. Read More

Gibson Dunn: Environmental, Social and Governance Update

Gibson Dunn's monthly ESG update breaks down how proposed sustainability reporting frameworks in the U.S., UK and EU could impact future ESG disclosures. Read More

FROM OUR DESK TO YOURS

It was an exciting week at GPP following a visit from friend and client Sally Susman, Executive Vice President and Chief Corporate Affairs Officer at Pfizer and author of Breaking Through: Communicating to Open Minds, Move Hearts, and Change the World. During her visit, Sally discussed the integral role communications played during Pfizer’s groundbreaking Covid-19 vaccine development and rollout, characteristics of an effective leader and the importance of acknowledging, and then learning from mistakes. One of our favorite chapters was the story of Paul Critchlow, the legendary former head of communications & public affairs at Bank of America Merrill Lynch turned “Senior Intern” at Pfizer. Sally’s idea to ask the recently retired Paul to join Pfizer as an intern, recalling the Robert De Niro character in “The Intern" with Anne Hathaway, resulted in employees at all levels gaining valuable insights and lessons from an industry pro who sat in the bullpen with other college interns. Sally, who has served on the board of WPP PLC and is one of our industry’s most senior executives, is always in the “room where it happened.“

Speaking of interns, GPP’s summer interns Janelle Puckering, Jina Zhao, Paris Sistilli and Rylee Iannaconne, asked great questions and were eager to learn more about Sally’s career. Aside from discovering the world of financial communications, they have also been exploring what NYC has to offer:

• Janelle visited Turtles All the Way Down, a bar in Brooklyn that hosts turtle racing on the first Sunday of each month. She bet on “Shanti”, the winning turtle, and won free drinks.
• Jina, an avid rock climber and cinephile, joined her local climbing gym and attended a screening at the Brooklyn Film Festival last weekend.
• Paris, although a Columbia University student, is experiencing her first summer in the city and is looking forward to enjoying a good book and playlist with picnics in Central Park.
• As a New Jersey native, Rylee is looking forward to being a tour guide for the other interns. On her “must-do” list is a walk on the High Line and grabbing a bite to eat at 375 Chicken and Fries. 

PEOPLE MOVES

• Carmine Di Sibio is retiring from his role as Chief Executive of EY. Read More

• Fred Ryan, the publisher and CEO of the Washington Post announced he will step down. Read More

• Charles Forelle has been appointed Deputy Editor-in-Chief of The Wall Street Journal. Read More

• Verizon has begun to search for a “CFO plus” to deepen the bench of potential CEO successors. Read More

• June 29: Latham & Watkins Webinar – 2023 Proxy Season Lessons Learned and Coming Attractions, Virtual 

• June 29: Skytop Strategies ESG – A Driver of Shareholder Value, New York