The Activist Investor Blog
The Activist Investor Blog
2013 in Review - A “Golden Age”?
At least, that’s what two different articles labeled this year for activist investing. And, this year worked out pretty well, at least for many activist investors, and for activist investing overall.
Apple? Really?
Who’d have thought that the largest market cap company, Apple, would become an activist target? Its cash holdings deserve attention, of course. Either Carl Icahn knows something, or just has bigger ... you know ... than anyone else. But, he did meet with the CEO, and continued what David Einhorn started in calling for returning capital to investors.
If it wasn’t a Golden Age for activist investors, at least it was for Carl Icahn. He landed on the covers of Forbes and Time, too, as he went after Dell and its go-private deal.
What’s with big tech? and Chase?
Besides Dell and Apple, investor pressure led to changes at Microsoft. ValueAct landed a BoD seat and helped show CEO Steve Ballmer the door.
Jamie Dimon survived a shareholder vote to separate him from the BoD chair spot at Chase, too, in the most-watched BoD election this year.
Emerging funds still emerging
Last year we identified three funds that started to make a splash in 2012: Meson Capital, Furlong Financial, and Privet Fund Management. Privet seemed to expand its reach in 2013, initiating several new activist projects (according to SEC filings). Meson and Furlong maintained existing positions.
Mostly quiet on the corp gov front
After a few exciting years, we haven’t seen much new in corporate governance since 2012.
The SEC resumed its research on the proxy voting system with a roundtable on proxy advisors. It attracted the usual crowd of supporters and detractors, and may or may not lead to tighter regulations on advisors.
Companies continue to declassify BoDs at a rapid clip, thanks in large part to the Shareholder Rights Project at Harvard Law School. By this time next year almost all of the S&P 500 should have single-class BoDs.
On the other hand, it looks like proxy access is dormant, if not close to dead. Eleven companies had proxy access proposals on their BoD agenda this year, with only two receiving any meaningful support from investors.
And, say-on-pay settled into a predictable, routine endorsement of exec comp plans. On average, exec comp plans received support from 90% of the shares, with only 22 companies in the S&P 1500 receiving less than a majority.
We gleaned these facts, and many others, from the useful Georgeson annual report.
Director compensation, with a twist
Two different activist investors attracted attention with plans to pay BoD nominees directly, out of portfolio gains. We see nothing wrong with this, and expect this trend to continue.
TAI stuff
We put together a toolkit for activist investors, with guides to exempt solicitations, consent solicitations, and special meetings.
Our ongoing efforts at Mac-Gray paid off in 2013, as the company accepted an attractive offer to go private. We continue our work at Comarco and other companies, and look forward to corresponding with you in 2014.
Tuesday, December 24, 2013