But after the Swiss banking software company slashed earning guidance, Petrus’ demands shifted to the removal of chief executive Max Chuard and Chairman Andreas Andreades and the launch a strategic review that could lead to an outright sale. It started with a small stake and calls for a strategy rethink. On December 9 the activist complained that management had not offered a meaningful response, setting the stage for a possible showdown in one of the clearest examples of how domestic activists are stepping up in Asia even as international activists remain wary of the region.Īctivism is down in Europe, but London-based Petrus Advisers showed it is ready to fight the board of Temenos. The stock has remained stagnant since then, however, resulting in domestic Korean firm Flashlight Capital Partners launching a campaign on October 25 with many of the same demands.įlashlight, founded in 2020 by Carlyle Group’s former Head of Korea, Sanghyun Lee, called on KT&G to boost shareholder returns by improving corporate governance, returning cash to shareholders and divesting the company’s ginseng business as it has little synergy with tobacco.
Korea Tobacco and Ginseng Corporation (KT&G) was one of the first Asian companies to face activist demands, losing a proxy fight to U.S.-based Steel Partners in 2006.
Hestia’s campaign got a boost on December 14 when Swiss asset manager BWM, with a 1.5% stake, said in a blog post that it was supportive of Hestia’s push for a new leadership team.įlashlight Capital Partners at KT&G Corp.ĭemands: Divestiture, return cash, corporate focus. “Given that the company’s total stockholder returns of negative 50% during Michael Roth’s 10+ years as Chair and Marc Lautenbach’s 10+ years as Chief Executive Officer, Hestia assumed the board and management would want to collaborate with a major stockholder on refreshing the board,” the activist wrote in an open letter. The 7.1% shareholder argued the company is a collection of ‘‘exceptional businesses’’ held back by its long-tenured leadership, particularly Chairman Michael Roth and CEO Marc Lautenbach. However, Hestia is now targeting a majority of Pitney Bowes’ board seats and the appointment of a new chief executive to lead the shipping and mailing company. Kurt Wolf’s Hestia Capital Management made a lot of money from its campaign at GameStop, notably from selling out at the right time. That said, board nomination and governance committee chair Patricia Bellinger saw lackluster support of 91.5% with dissenting shareholders citing a combined CEO and chair, a lack of ties between performance and executive pay, and a high special meeting threshold.ĭemands: Remove CEO, gain board representation. The company only settled with another activist three years ago, when it was known as L Brands, spinning off Victoria’s Secret during the pandemic. Bath & Body’s board compensation committee “has made errors in structuring its executive compensation such that excessive awards have been made that are untethered to important performance metrics,” Third Point stated, adding that it “reserved the right” to seek changes in board composition and other value enhancement measures at or before the company’s next annual meeting.ĭespite Loeb’s complaints, Bath & Body Works gets an excellent rating from Insightia’s Governance module. But its December 8 disclosure that it had increased its stake in Bath & Body Works to over 6% made clear the activist was ready to step up its engagement.
But rather than talk, the board approved a poison pill rights plan and bylaw changes such as an “extreme” change of control provision, that look designed to ward off Politan and other unwanted activists.Ī clue to what demands Politan might make in a proxy fight can be found in the activist’s December 2021 settlement agreement with Centene, which gave Politan five board seats and forced the company’s CEO to retire.ĭaniel Loeb’s Third Point Partners has in recent years rebranded itself as a constructivist. Governance is another problem, with Masimo getting a “bad” rating from Insightia’s Governance module, largely because Joe Kiani has served as both chief executive officer and board chairman for 33 years. Politan disclosed an 8.4% stake in August, taking advantage of a sharp drop in the share price brought on largely by the $1 billion acquisition of speaker company Sound United, which sent the stock down 37% the day after that announcement. Medical technology company Masimo has done pretty much all it can to guarantee that any proxy fight with Politan Capital will be a bitter one. Here are eight current activist campaigns that look most likely to turn into full-fledged proxy fights. As of December 16, there were 235 outstanding demands by partial and full-time activists at 108 companies, according to Insightia data. The 2023 proxy season has not officially begun, but activists are already making demands and threatening proxy fights for the New Year.
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