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- Activist investors had their busiest quarter ever, with slumping share prices stoking campaigners, the FT said.
- Fights against Disney and Salesforce were among boardroom battles, although US activity fell 30%.
- A South Korean firm was the most prolific and took on K-pop music pioneer SM Entertainment.
Activist investors worldwide have had their busiest quarter on record, with slumping share prices stoking campaigners to buy what they see as undervalued stocks and then putting their newfound power toward pushing for changes, according to a Financial Times report.
The upswing took place after activists pared back work during the height of the COVID pandemic, then returned when stocks worldwide slid on a mix of factors including company-specific issues and rising interest rates.
During the first quarter, 83 new campaigns were launched, the report said, citing data collected by Barclays. For the first time, campaigns in Europe and Asia accounted for more than 50% of overall activity.
South Korea's Align Partner was the most prolific activist investor during the first quarter, launching eight campaigns, including a high-profile battle against SM Entertainment, whose founder Lee Soo-Man is credited with bringing K-pop music to worldwide audiences with acts including BoA, Super Junior and EXO.
US activity was down 30% year over year. Walt Disney's short proxy battle started by Nelson Peltz's Trian Fund Management was among the boardroom battles. Peltz in February said Trian would end its three-month proxy fight against Disney after CEO Bob Iger unveiled restructuring efforts, including layoffs and other cost cuts. Peltz reportedly made a $150 million paper profit from his battle against Disney.
In other action, hedge fund Elliott Management in January took a multibillion-dollar stake in Salesforce, as the cloud-software maker dealt with layoffs and a management shake-up.
And last month, billionaire investor Carl Icahn was pushing forward with a proxy fight against Illumina, as he wants the company to divest cancer test developer Grail Inc. The Federal Trade Commission last week ordered Illumina, a maker of gene-sequencing machines, to divest Grail.
The FT report said the landscape for boardroom battles may be reset after the Securities and Exchange Commission last year introduced a so-called universal proxy card, which must include all director nominees presented by management and investors for election at shareholder meetings.
The rules will "enhance shareholder democracy," SEC Commissioner Gary Gensler said in November. "It will put investors voting in person and by proxy on equal footing.