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Watch out for the Young Bloods.
In their year-end activism reports, both Barclays and Lazard noted the surge in smaller names in the activism space. Per Lazard, last year, 47% of activists were “first timers” – a stark jump from 42%, 36% and 28% in the respective three years. What that means for corporates and advisors: Less predictability, earlier public campaigns, and funds more likely to want to make a name for themselves.
Nearly 90 new firms launched a campaign in 2024 and during an interview on Bloomberg, Barclays global head of shareholder advisory, Jim Rossman, predicted that this trend isn’t slowing down: “What’s happening now is that a whole new generation of asset managers who in the past might not have adopted this strategy are saying, ‘if we don’t do it, we’re not going to sit around and wait for Elliott to do it… why don’t we step into the breach?’”
Speaking of, Elliott was, as usual, the most frequent flyer in 2024, with 14 campaigns launched at household names like Southwest Airlines and Starbucks, the latter of which ultimately replaced its CEO. CNBC’s Leslie Picker, reporting on the Lazard research, noted that, as with Starbucks, an activist doesn’t even have to publicly demand change at the top of the corporate ladder for it to happen anyway. As Axios’ Mike Flaherty reported, last year a record number of CEOs – 27 – stepped down after their companies were targeted by activists.
One social activist who has made quite a name for himself is anti-DEI crusader Robby Starbuck, whose war on woke has sent shudders through corporate boardrooms. It seems Starbuck has finally met his match with Costco, a company that withstood his assault in its own special way. Costco still has $1.50 hot dogs and they ain’t caving to no stinking activist. Bloomberg Opinion columnist Beth Kowitt explains why.
Finally, be careful extending a “Happy New Year” salutation because according to Larry David, the statute of limitations has passed. Let’s circle back instead.
Look forward to battling the crowds in San Fran for the 43rd Annual JPM Healthcare Conference next week, and please remember to register for the Tulane Law Confab, which is early this year.
Cheers,
GPP
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