Hostile Resistance To Hedge Fund Activism

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Hostile Resistance To Hedge Fund Activism

Hostile Resistance To Hedge Fund Activism

Nicole M. Boyson
Northeastern University – D’Amore-McKim School of Business

Pegaret Pichler
Northeastern University, D’Amore-McKim School of Business, Finance Area

Bonhoeffer Fund July 2022 Performance Update

Screenshot 27Bonhoeffer Fund's performance update for the month ended July 31, 2022. Q2 2022 hedge fund letters, conferences and more The Bonhoeffer Fund returned 3.5% net of fees in July, for a year-to-date return of -15.8%.   Bonhoeffer Fund, LP, is a value-oriented private investment partnership for . . . SORRY! This content is exclusively for Read More

July 6, 2016

Abstract:

Target firms openly resist hedge fund activists about one-fourth of the time, via poison pills, lawsuits, and restrictions on shareholder actions. Target firm resistance is met with a significantly negative market reaction, reducing the initial positive reaction to activism announcement. Unless hedge funds counter-resist with a proxy fight or lawsuit, targets are less likely to accede to hedge fund demands, be acquired, or experience improved long-term operating performance compared to non-resisting targets of the same hedge funds. By contrast, when hedge funds counter-resist, target firm outcomes do not differ relative to non-resisting targets of the same hedge funds.