Activism In Europe Is Expected To Reach Record Levels In 2016 by Activist Insight
64 European-based companies had been publicly subject to demands by activist investors by the end of the first half of 2016, setting the stage for a potentially record-breaking year.
Activist Insight projections, based on the rate of activity in previous years and revealed in a special report for international law firm Skadden, Arps, Slate, Meagher & Flom LLP entitled Activism in Europe: September 2016, suggest as many as 97 companies could be targeted by the end of 2016 – ahead of the previous peak of 67 companies in 2015.
Activist activity is expected to exceed prior levels, tracked by Activist Insight as far back as 2010, in the U.K., Italy and Germany – scene of high-profile showdowns at Stada Arzneimittel and Volkwagen.
The report, which includes country profiles of the U.K., France, Germany, Italy and Switzerland – which represents approximately 80% of the European companies targeted by activists since 2010 – features data and analysis from Activist Insight, the leading provider of information on shareholder activism worldwide, and legal analysis from Skadden partners.
A breakdown of the country-by-country activity is below.
Activism in Europe has long been seen as catching up with the U.S., where the number of companies targeted regularly tops several hundred. European funds dedicated to activism manage around $27.5 billion, according to Activist Insight, currently still a relatively small portion of the $163 billion dedicated to activism globally.
More homegrown activism
In a piece of research specially conducted to accompany the launch of the report, Activist Insight found that despite rising levels of activism, the level of campaigns from outside Europe is at a relative low in the year-to-date.
Although the absolute number of companies targeted by non-European based activists is at a high of 23 – equal to 2012’s peak – rising numbers of European-led activist campaigns mean the proportion of companies targeted by a non-European activist are at 17%. That is the lowest since 2010, when the volume of activism was much lower.
Josh Black, editor of the report and Editor-in-Chief at Activist Insight, commented: “Activist investing has been revived as a force in Europe, strengthening the perception that underperforming companies will soon have to be as wary of it as their American peers are today. In addition, the spread of activist activity throughout the major European markets makes clear that this is no longer purely an Anglo-Saxon phenomenon. Activist Insight is pleased to partner with Skadden to deliver this report at a dynamic time in this story of activism in Europe.”
Armand Grumberg, Head of European M&A for Skadden commented: “As a frequent adviser to companies dealing with an activist investor, we have noted the recent increase in activity in Europe and believe these data confirm that activism is likely to be a force to be reckoned with for years to come. No company should consider itself immune against activist campaigns – even those currently outperforming their peers. Advance preparation remains critical in this respect.”
About Activist Insight
Since 2012, Activist Insight has provided its clients with the most comprehensive information on activist investing worldwide. Regularly quoted in the financial press, Activist Insight is the trusted source for data in this evolving space. In 2016, Activist Insight launched Activist Insight Shorts after acquiring Activist Shorts Research. Activist Insight offers three great products: Activist Insight Online, Activist Insight Shorts and Activist Insight Monthly – the world’s only magazine dedicated to activist investing.
About Skadden, Arps, Slate, Meagher & Flom
Skadden is a global leader among law firms involved in mergers and acquisitions and other corporate transactions, and a top adviser for clients on corporate governance, takeover preparedness, contests for corporate control, proxy fights and other forms of shareholder activism. We provide clients with an integrated team from different areas of law, including attorneys from our M&A, corporate governance and litigation practices. Our diversity of experience helps clients address the full spectrum of issues presented by activists and is key to helping our clients prepare for and respond to activist shareholders advocating strategic, financial or structural changes.