Activist investors mount record number of attacks against companies

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Companies faced a record number of attacks from activist investors in 2023 as disgruntled shareholders sought to oust directors or force the sales of businesses whose share prices had languished. 

There were 252 new campaigns globally, according to a report by investment bank Lazard, a 7 per cent increase on the previous year. Few companies were safe from scrutiny, with a broad range of activists targeting blue-chip businesses such as Walt Disney, Salesforce and Starbucks.  

Europe and Asia Pacific saw record levels of activity, with the UK and Japan leading the pack. There were 69 campaigns launched in Europe, most of which had demands related to mergers and acquisitions, and 44 new campaigns in Asia Pacific where local hedge funds were the most active participants. 

“Activism today has a very regional dynamic,” said Rich Thomas, a managing director in Lazard’s capital markets advisory group. “Global campaigns are at an all-time high because [Asia Pacific] and Europe have had a breakout year.”

Activists typically buy stakes in companies and lobby for changes they believe will help increase the share price. In its earlier years investors attacked businesses and their leadership in public letters but advisers said much of the negotiating between activists and targets now took place behind closed doors. 

However, a number of high-profile battles have spilled into the public forum, adding to pressure on executive teams dealing with slowing economic growth and higher interest rates. 

Trian Partners last year said it would seek two board seats at Disney, setting the stage for one of the most contentious proxy fights in years and pitting its co-founder Nelson Peltz against returning chief executive Bob Iger. 

Carl Icahn, whose own public investment company was attacked by activist short seller Hindenburg Research, waged an aggressive…